I took a long on the GBP/JPY pair this morning after the pinbar formed. (4 hour chart, at 8 a.m. EST.)
Even though I know the markets are going to be jittery until Bernanke makes his move tomorrow, I decided to jump on board. I took a small profit, at 40 pips. This wasn't the entire move, but I am happy.
I could have also taken the GBP/USD pinbar as well. I passed on this, as it has "USD" in it's pair. Also, as a side note, I know there is a lot of worry in England about Northern Rock and it's issues.
It is because of the above two paragraphs that I tempered my expectations. 40 pips is a good day. (Although under normal circumstances I would have swung for about 80.)
Even if I only get these 40 pips this week, I am still making money, and that's what the game is about.
As a word of advice: Don't try to trade the interest rate announcement, it has real potential to be a whipsaw. There are a ton of people wanting a 50 bp cut, and a lot pricing in a 25 bp cut. The truth is that nobody knows whats going to happen, and this particular announcement has 0% chance of making everyone happy. I expect to see major confusion for a little while afterwards.
Once the dust settles, we could find our trend, but until then.....stay the hell away from the U.S. Dollar.
Monday, September 17, 2007
Friday, September 14, 2007
Maturity, and the longer time frame.
Hi guys -
Well, I am up about 4% this week, and only somewhat happy about it.
Today, on Friday, I made a couple of short-term trades that didn't go so well. It was yet another example to me that longer time frames are BY FAR the way to go.
I can only explain the need to trade news as simply the need to trade. Period. Is it greed? Boredom? Stupidity? Maybe all three.
My shit broker, Interbank FX, decided to widen the spreads 15 minutes AFTER the release on the USD/JPY to 8 pips. (Can you say, "Oh my God! All of our customers are on the other side of the trade, and we are about to get it handed to us!"?)
Oh, and they did it at 7:23 a.m. EST as well, because we all know what a volitle time that can be.
Anyways, the point is this: Why bother going for just a handful of pips? Why bother possibly being psyched out by the asshole broker?
When you are trading on the 4 hour, or even daily, you are literally "above" the noise.
My advice: Trade smaller sizes, and longer time frames. When you have a stop loss that is wide enough to drive a friggin' bus through, the dealing desks games are not very likely to effect you.
Shame on you idiot. That was a minor breakdown in maturity today. (This was directed at myself. lol)
Have a good weekend, and you gotta love the AUD/USD daily pinbar this week!
Well, I am up about 4% this week, and only somewhat happy about it.
Today, on Friday, I made a couple of short-term trades that didn't go so well. It was yet another example to me that longer time frames are BY FAR the way to go.
I can only explain the need to trade news as simply the need to trade. Period. Is it greed? Boredom? Stupidity? Maybe all three.
My shit broker, Interbank FX, decided to widen the spreads 15 minutes AFTER the release on the USD/JPY to 8 pips. (Can you say, "Oh my God! All of our customers are on the other side of the trade, and we are about to get it handed to us!"?)
Oh, and they did it at 7:23 a.m. EST as well, because we all know what a volitle time that can be.
Anyways, the point is this: Why bother going for just a handful of pips? Why bother possibly being psyched out by the asshole broker?
When you are trading on the 4 hour, or even daily, you are literally "above" the noise.
My advice: Trade smaller sizes, and longer time frames. When you have a stop loss that is wide enough to drive a friggin' bus through, the dealing desks games are not very likely to effect you.
Shame on you idiot. That was a minor breakdown in maturity today. (This was directed at myself. lol)
Have a good weekend, and you gotta love the AUD/USD daily pinbar this week!
Sunday, September 9, 2007
BOOK REVIEW: "Adventures of a Currency Trader"
Hi guys -
This post is going to be a little different, so bear with me here.
I recently have received a copy of Rob Booker's "Adventures Of A Currency Trader". As I am always looking for more information, I was interested in this approach to trading education. This is not your usual technical analysis book. There are no magic formulas in this book. This book is a novel. And a damn good one, in my opinion.
To give you an idea, I read the thing front to back in one sitting. (And plan on reading it again next weekend.)
The main character here is a man named Harry Banes. Harry starts out trading one day, using some "black box" software. As a tribute to the futility of such software, Harry's first trade is a profit, even though he accidentally took the exact opposite position that the software indicated. (Another amusing part of this: The login name is SUPERTRADER_2000, password: G$TRICH. This is a peek into this guy's mind right away.)
From the start, Harry truly is a bad trader, with giant dreams. Harry makes several emotional and bad decisions along the way. (Both in trading and personal challenges.) Harry sounds familiar. Harry is each and every one of us. Harry is the sum of all of our bad habits. Booker manages to convey a lot of basic truths about the common Forex trader, without listing them. He actually has built an interesting story around these lessons.
Harry eventually learns the truths of trading. The truth shall set you free, in more ways than one. This story does have a happy ending. But, he has to learn all of those hard lessons we are all struggling with.
Booker even throws some charts in the book, but not necessarily with a lesson attached to it. Well, let me take that back, it's there, but not quite as boring and obvious as so many other books. The charts are for illustration. (EUR/USD at 1.1850 anyone?)
As I mentioned the happy ending before, that is where I have the one issue with this book - It has an ending. This book could easily be 1,000 pages, as it truly is that easy to read. I found myself nodding in agreement with certain siutations, and laughing at others.
He even goes into busting a few myths about bank traders having some kind of "magical aura" about them. He presents them as human. Certainly Booker is trying to convey that they are not the "legendary traders" most of us out here think. They are capable of making stupid, greedy trades as well. Booker paints a picture of a trading room that is quite different than most people out here believe.
One point Booker brings up more than once is that longer term charts are the way to go. He even presents a lot of the mathmatical reasons for it in a conversation. When you go and get this book, please read this particular part a few hundred times. I have never taken any of his courses, but I am willing to bet he doesn't promote scalping. (Which makes him good in my opinion.)
There are far too many people out there pushing the "greed buttons" on all of us traders. Booker not only dispells this myth of getting rich quick, but also makes a compelling argument to treat Forex as an investment. He points out how this is a job, and it takes work. He even manages to do it in an entertaining way.
The story leaves with some unanswered questions about the future. I suspect that a sequel could be in the works. I certainly hope so, as I will be buying it.
I rate this book 5 out of 5 pips!
This post is going to be a little different, so bear with me here.
I recently have received a copy of Rob Booker's "Adventures Of A Currency Trader". As I am always looking for more information, I was interested in this approach to trading education. This is not your usual technical analysis book. There are no magic formulas in this book. This book is a novel. And a damn good one, in my opinion.
To give you an idea, I read the thing front to back in one sitting. (And plan on reading it again next weekend.)
The main character here is a man named Harry Banes. Harry starts out trading one day, using some "black box" software. As a tribute to the futility of such software, Harry's first trade is a profit, even though he accidentally took the exact opposite position that the software indicated. (Another amusing part of this: The login name is SUPERTRADER_2000, password: G$TRICH. This is a peek into this guy's mind right away.)
From the start, Harry truly is a bad trader, with giant dreams. Harry makes several emotional and bad decisions along the way. (Both in trading and personal challenges.) Harry sounds familiar. Harry is each and every one of us. Harry is the sum of all of our bad habits. Booker manages to convey a lot of basic truths about the common Forex trader, without listing them. He actually has built an interesting story around these lessons.
Harry eventually learns the truths of trading. The truth shall set you free, in more ways than one. This story does have a happy ending. But, he has to learn all of those hard lessons we are all struggling with.
Booker even throws some charts in the book, but not necessarily with a lesson attached to it. Well, let me take that back, it's there, but not quite as boring and obvious as so many other books. The charts are for illustration. (EUR/USD at 1.1850 anyone?)
As I mentioned the happy ending before, that is where I have the one issue with this book - It has an ending. This book could easily be 1,000 pages, as it truly is that easy to read. I found myself nodding in agreement with certain siutations, and laughing at others.
He even goes into busting a few myths about bank traders having some kind of "magical aura" about them. He presents them as human. Certainly Booker is trying to convey that they are not the "legendary traders" most of us out here think. They are capable of making stupid, greedy trades as well. Booker paints a picture of a trading room that is quite different than most people out here believe.
One point Booker brings up more than once is that longer term charts are the way to go. He even presents a lot of the mathmatical reasons for it in a conversation. When you go and get this book, please read this particular part a few hundred times. I have never taken any of his courses, but I am willing to bet he doesn't promote scalping. (Which makes him good in my opinion.)
There are far too many people out there pushing the "greed buttons" on all of us traders. Booker not only dispells this myth of getting rich quick, but also makes a compelling argument to treat Forex as an investment. He points out how this is a job, and it takes work. He even manages to do it in an entertaining way.
The story leaves with some unanswered questions about the future. I suspect that a sequel could be in the works. I certainly hope so, as I will be buying it.
I rate this book 5 out of 5 pips!
Saturday, September 8, 2007
Making money from other's misery.
Hi kids -
Well the NFP was total crap. Not for me, I made money. (Not like it was much of a challenge to be honest.)
So, we have problems in the housing sector, and nobody wants to hire anyone. A change in the U.S. economy? You bet.
I am actually in construction by trade, and to be honest, I am surprised it took this long for the spector of weakness to truly show itself. The houses being built over the last few decades have been really, really, worthless. The only thing I can imagine being more worthless, is the artificial "bull run" of the sector in general.
I live in Columbus, Ohio. It is interesting to look at the housing sector here. For the last few years, you could hardly walk 5 feet in this city without bumping into a stupid mortgage broker. Oh, and the telemarketing....even worse.
The city has expanded by about 4 or 5 times since the mid-80's. We keep building one cookie-cutter suburbian development after another. There has been so much construction work, I could have easily switched trades a few years ago, just by claiming to be in another trade.
The one thing that I could never figure out was this: "How many houses can they build, and keep full?". I think we are starting to see the answer.
A perfect example is Hilliard. It's a suburb of Columbus that was really hot a few years ago. Now it's New Albany that's "hot". (Les Wexner of Victoria's Secret/Express/Limited fame pretty much built the little town up.) Guess what's happening to Hilliard? You got it, nobody really cares about it. Not that land value is dropping, it's just not going anywhere. At all. Most of the houses built there in the last 10-15 years are already falling apart.
So you are probably asking by now..."What does this have to do with me, and how are you going to make me rich with this stupid story?".
Here goes, and this is just a theory. It's correct, but I must say it's not advice. It's not my fault if you use it poorly, so don't blame me.
Sell the dollar. I think that part is obvious. But as Forex traders, we tend to forget there are other ways to make a buck out there.
My plan is too wait another 6 months or so for the housing market to really go bad. Then, I plan on buying a 4 unit townhome building. Since nobody can buy houses, they have to rent. As a few years go by, slowly rehab the units between renters. When the housing market comes back, and it will, it will be time to condo the units out.
The worst thing that can happen is that you are stuck with rental property. You can make money that way as well.
The point is this: The smart money always gets in when everyone else has given up. We aren't there quite yet, but pretty damn close.
Well the NFP was total crap. Not for me, I made money. (Not like it was much of a challenge to be honest.)
So, we have problems in the housing sector, and nobody wants to hire anyone. A change in the U.S. economy? You bet.
I am actually in construction by trade, and to be honest, I am surprised it took this long for the spector of weakness to truly show itself. The houses being built over the last few decades have been really, really, worthless. The only thing I can imagine being more worthless, is the artificial "bull run" of the sector in general.
I live in Columbus, Ohio. It is interesting to look at the housing sector here. For the last few years, you could hardly walk 5 feet in this city without bumping into a stupid mortgage broker. Oh, and the telemarketing....even worse.
The city has expanded by about 4 or 5 times since the mid-80's. We keep building one cookie-cutter suburbian development after another. There has been so much construction work, I could have easily switched trades a few years ago, just by claiming to be in another trade.
The one thing that I could never figure out was this: "How many houses can they build, and keep full?". I think we are starting to see the answer.
A perfect example is Hilliard. It's a suburb of Columbus that was really hot a few years ago. Now it's New Albany that's "hot". (Les Wexner of Victoria's Secret/Express/Limited fame pretty much built the little town up.) Guess what's happening to Hilliard? You got it, nobody really cares about it. Not that land value is dropping, it's just not going anywhere. At all. Most of the houses built there in the last 10-15 years are already falling apart.
So you are probably asking by now..."What does this have to do with me, and how are you going to make me rich with this stupid story?".
Here goes, and this is just a theory. It's correct, but I must say it's not advice. It's not my fault if you use it poorly, so don't blame me.
Sell the dollar. I think that part is obvious. But as Forex traders, we tend to forget there are other ways to make a buck out there.
My plan is too wait another 6 months or so for the housing market to really go bad. Then, I plan on buying a 4 unit townhome building. Since nobody can buy houses, they have to rent. As a few years go by, slowly rehab the units between renters. When the housing market comes back, and it will, it will be time to condo the units out.
The worst thing that can happen is that you are stuck with rental property. You can make money that way as well.
The point is this: The smart money always gets in when everyone else has given up. We aren't there quite yet, but pretty damn close.
Tuesday, September 4, 2007
A global shift? Maybe.
Alright, so here we go this week...
We are seeing some range-bound action in most crosses this week, and for good reason.
There is a ton of economic data coming out in the next few days. My advice for the newer trader? Stay out. THERE WILL ALWAYS BE A MARKET. YOU DON'T HAVE TO MAKE YOUR MILLIONS THIS PARTICULAR WEEK.
I understand that most bloggers on the net will give some technical levels, and tell you long or short above/below, but I think this week is good for observing. Especially if you haven't been doing this for any great length of time.
I do however, feel that most if not all JPY crosses are going to remain biased to the downside. But I still don't think it is time yet.
Besides the various figures coming out, you have interest rate announcements coming out of Canada, the UK, and Australia. (not to mention Sweden, which is expected to hike rates.....not paying attention there, can't even trade it on my platform.)
Anyway, what this means is people will be looking for the wording of these statements. Trying to predict the future, and anytime this happens, we get random noise. The perfect storm for a losing trade everytime.
Also, being that September just started, the big boys are back from vacation, and trying to figure out their next move, which will probably last until the end of the year.
My suggestion is to wait and see what they are going to do.....I have an opinon, (as stated above.) but it's just that - an opinion. I would rather trade on the facts.
Expect September to be interesting to say the least.
I am trading very lightly until about the 18th or so. I figure by then we might see some true intentions.
As a side note, I did pick up about 30 pips in EUR/JPY going short this morning. Good enough for me. (I might right about expectations a little later, and lessons about being a pig. Good stuff to think about.)
Until then, cheers.....
Clockwork
We are seeing some range-bound action in most crosses this week, and for good reason.
There is a ton of economic data coming out in the next few days. My advice for the newer trader? Stay out. THERE WILL ALWAYS BE A MARKET. YOU DON'T HAVE TO MAKE YOUR MILLIONS THIS PARTICULAR WEEK.
I understand that most bloggers on the net will give some technical levels, and tell you long or short above/below, but I think this week is good for observing. Especially if you haven't been doing this for any great length of time.
I do however, feel that most if not all JPY crosses are going to remain biased to the downside. But I still don't think it is time yet.
Besides the various figures coming out, you have interest rate announcements coming out of Canada, the UK, and Australia. (not to mention Sweden, which is expected to hike rates.....not paying attention there, can't even trade it on my platform.)
Anyway, what this means is people will be looking for the wording of these statements. Trying to predict the future, and anytime this happens, we get random noise. The perfect storm for a losing trade everytime.
Also, being that September just started, the big boys are back from vacation, and trying to figure out their next move, which will probably last until the end of the year.
My suggestion is to wait and see what they are going to do.....I have an opinon, (as stated above.) but it's just that - an opinion. I would rather trade on the facts.
Expect September to be interesting to say the least.
I am trading very lightly until about the 18th or so. I figure by then we might see some true intentions.
As a side note, I did pick up about 30 pips in EUR/JPY going short this morning. Good enough for me. (I might right about expectations a little later, and lessons about being a pig. Good stuff to think about.)
Until then, cheers.....
Clockwork
Subscribe to:
Posts (Atom)