How to Remove Bias from Trading

During analysis and trading it is quite easy to fall in an ‘invisible trap of confirmation’ and it happens to every single trader on earth. That sounds fancy but the principle is simple. Let me explain by asking you these 3 questions:

• Have you ever absolutely loved a trade setup before you entered the market?


• But after exiting the trade, you suddenly started to dislike it more and more?


• Or maybe you even disliked it during the trade or just after the setup?

Did you indeed answer ‘yes’ to the above questions? Has this situation ever occurred to YOU? Let us know down below!

If you did answer ‘yes’, then do not be alarmed because this is normal. In fact, it occurs to almost all traders… And if it has not happened to you yet, then pay attention closely because odds are high that it will – sooner than later.

CONFIRMATION BIAS EXPLAINED

Our brains naturally and automatically seek confirmation of our bias (for longs or shorts on the pair). Any ‘neutrality’ disappears when a trader is convinced that the short or long is a great trade setup and the trader only sees confirmation. Here is an example of how the process works:

‘Trader John sees the GBPUSD. Price is bounding off of a support. He already expected price to respect that level. Oh no, it has moved another 10 pips. And the hourly has bullish candles as well. I must take this long – NOW – before it’s too late.’

In other words: prior to taking the trade, the setup looks invincible and nothing can stand in the way between the trader and the profits. Other traders might be (more) realistic in their outlook of a trade but give the ‘benefit of the doubt’ to their trade setup and still ‘give it a try’. It is very interesting though that once a trade is on the way, traders suddenly see the chart from a different perspective. The trade setup looks worse, more dangerous and in some cases just plain awful. Why? What just happened? Why was a trade that was entered a minute ago suddenly so different?

Let me explain why: the mind. Our minds prefer to seek confirmation of our analysis. Once traders have a trade setup in vision, the mind will focus on finding confirming arguments. The rosy colored glasses are only removed when a trade has been entered or if the trade is not going our way.

So yes be prepared, our minds are going to ‘trick’ us to believe that our analysis is correct and it will look for more and more confirmation until we hit the boiling point and just ‘click’ the button to either buy or sell.

What can we do to make our analysis with less bias and a better reflection of reality?

SOLUTIONS

The first solution to this challenge is by implementing a solid edge via rule based strategy and trading plan. The rules in the plan provide traders with confidence and a road map when to enter and exit appropriately (when the rosy glasses are weakest). The strategy we use in our WET trading room is the StrikerTrader: clear, simple and easy to follow. Sustainable profits are a matter of following the plan and not guessing what price will do at ever single point.

The second solution is to set up confirmation criteria of our analysis and wait for price to meet those criteria before trading. A trader cannot fully remove a bias when the trade setup is coming closer to entry point so that is why setting up confirmation points of the analysis is useful. By doing so, traders establish clear and logical events (candle stick patterns, break through or bounce at trend line) which helps traders from entering and exiting inappropriately due to the confirmation problem.

The third solution is using the TOFTEM model when approaching the Forex market. By deliberately focusing on various steps of the model, the trader is forced to look at the currency pair in a different angle than usual, which stimulates the critical thinking prior to entering and exiting the trade and decreases the ‘conformation’ bias traders tend to have.

What do you think of the solutions? Are there are methods you use to keep your focus?

Thanks for sharing and Happy Trading!

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Trend Trading For Dummies in Bookstores Now!

Intraday technical levels and trading recommendations on EUR/USD for October 17, 2014

The recent bearish slide below 1.2870 invalidated the previous attempt of bullish reversal. Thus, bearish decline towards 1.2680 and 1.2510 took place shortly after.

Last week, the EUR/USD pair looked oversold and was trading beyond the lower limit of the channel before bullish momentum could get it back inside the channel.

That’s why, price action around 1.2580-1.2600 (the lower limit of the channel) was important to determine the next destination.

Bullish recovery was expressed off 1.2500 and 1.2600 to push towards 1.2700 and 1.2830 (back inside the channel).

The origin of the bullish engulfing pattern (around 1.2600) provided a good BUY position as suggested in previous articles. It’s running in profits now.

The upper limit of the movement channel (1.2880-1.2900) is being approached. Bearish pressure is anticipated to be applied.

The medium-term bearish trend remains intact as long as the bears keep defending the price zone around 1.2880-1.2900 (the recent consolidation zone).

A short-term bullish Head and Shoulders pattern was established on the 4H chart as anticipated. 4H fixation above 1.2700 confirmed the reversal and allowed the bulls to reach 1.2850.

A valid BUY position was suggested around the origin of the bullish Head and Shoulders pattern (price level of 1.2660). The final target is being approached today around 1.2900.

Recommendation :

Price action should be watched around 1.2870-1.2900 (upper limit of the channel and previous broken demand level) for one more SELL position.

Stop loss for this short position should be located above 1.2965.

On the other hand, price level of 1.2700 should be watched for price action if visited first. It may provide another intraday long position.

The material has been provided by InstaForex Company – www.instaforex.com

Forex analysis review

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Options Trading for Income with John Locke for October 13, 2014

No relevant positions

Risk disclaimer

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An Interview with Mike Bellafiore: His Favorite Trade, Trading Volatility, and Key Market Levels

In the video below, Mike Bellafiore is interviewed before Friday’s open by Benzinga- #PreMarket Prep Show. Mike discusses:

1) Market levels that may signal the end of the market’s uptrend

2) His favorite trade: The Trend Trend Changing Fundamentals Trade

3) What and how to trade when the volatility rises

*no relevant positions

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USD/CAD intraday technical levels and trading recommendations for October 10, 2014

Overview :

Two months ago, the ongoing bearish swing (ilogged in March 2014) was hindered at the price level of 1.0620. This price level corresponded to the lower limit of the channel as well as the backside of a steeper bearish one.

In August, bullish breakout off the movement channel took place. This enabled a bullish Flag pattern to be established. Bullish targets were successfully hit, including price level of 1.1230.

Strong bullish momentum has been expressed for a couple of weeks. Note that breaching price zone of 1.1230-1.1260 and fixation above it triggers new bullish swing.

On the other hand, a break below 1.1100-1.1070 is more likely to happen. This indicates that the bearish correction will extend further towards 1.0980-1.0950 where a key-support zone is depicted on the chart (the lower limit of the bullish channel and 50% Fibonacci level).

Recommendations:

The price zone of 1.1250-1.1276 corresponded to previous significant tops on the daily chart. Extensive bearish rejection was expressed as anticipated.

Risky traders can take a SELL entry around 1.1200-1.1245. Bearish targets are located at 1.1080 and 1.0990.

Then, the price zone of 1.0980-1.0950 should be watched for another LONG position to make use of the ongoing bullish trend.

The material has been provided by InstaForex Company – www.instaforex.com

Forex analysis review

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Options Trading for Income with John Locke for October 6, 2014

A great way to improve your trading results is by keeping up to date with the latest trading techniques and current market conditions!

Enjoy the Video!

Join me for my free group mentoring session Thursday 10/16/14 at 5:30 PM EDT

No relevant positions

Risk disclaimer

SMB Capital – Trading Education

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Why Trading Psychology is Crucial with the GBPJPY Monthly Breakout

The GBPJPY is well known in Forex for its large extended price movements. At times this currency pair moves like no other and it is able to fly up and down hundreds of pips. For other currency pairs, such as the EURUSD and AUDUSD, similar movements could only be achieved in a week or two of price action. Due to its lightening speed the GBPJPY is sometimes referred to as the Ferrari of the Forex.

THE SLOWDOWN

However, the once so speedy GBPJPY slowed down substantially in 2014. It seems like the US Dollar (partly) took over its role as this currency accelerated in its movements. Between March and August (6 months) the GBPJPY stayed confined within a range of less than 1,000 pips. The difference between these months and prior candles is easy to recognize when looking at this chart:

THE BREAK

That slowdown broke druing the last month of September: the GBPJPY closed the month with a 1150 pip candle (measured from high to low) and price managed to push above the range (blue lines). The month did end bullish but there was a bit of a wick on top (screenshot above). Lets zoom into the weekly chart to see more details.

THE WEEKLY

The following points are in my opinion the most interesting observations from the weekly chart:

1. Price is in an uptrend and has remained above the uptrend line (blue);


2. The orange trend lines represent the range;


3. Price managed to break above the range;


4. Price is now back at the top of the range;


5. Broken resistance can become support in the future.

Conclusion: this could be a hookback and a bounce spot for more bullishness. But I want to zoom into lower time time frames to look for confirmation that price could indeed be bouncing at this potential support.

THE CONFIRMATION BOUNCE

The 4 hour chart is not showing any strong bullish reversal candle stick patterns or other signals. There are no strong bullish engulfing twins, no bullish pinbars or inverted head and shoulders chart patterns to be found. In fact price is in a neat downtrend channel (blue) – although the lines only have 2 hits (read more here).

The dynamics do change once I start to place Fibonacci levels on the chart. With Fibs on both the bullish and bearish swing high and swing low, I can see that price is approaching a confluence of a 61.8 retracement (purple) and -61.8 (dark red) but that it did not hit the area as yet.

Conclusion: I am still interested in trading the potential weekly bounce off of broken resistance but only if I:

1. See a candle stick pattern at the 61.8/-61.8 Fibonacci confluence (purple) and/or


2. See the down trend channel (orange) break (blue) and/or


3. See price making a start of an up trend channel (green).

THE CONCLUSION

As we can see, not always must analysis lead to something that can or should be traded NOW. Sometimes its better to wait for confirmation and extra signals. Of course, its great if the analysis does lead up to an immediate entry or pending order, but I avoid taking trades just because I made analysis on this pair.

Sometimes traders do not want to waste time and therefore most of their analysis work will lead to an immediate trade setup. This is chasing the market (getting in too early) or jumping the gun (getting too late): a bad and costly hobby of a trader.

Do you agree?

Do you recognize yourself in the above profile?

Do you also tend to want to take a trade after analysis?

Let us know down below! Happy Trading.

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Trading Lessons from a Pick Pocket

I had the pleasure of meeting Apollo Robbins last week in Boston. For those of you who don’t know him he is the deception specialist on the TV show “Brain Games” and heralded as the world’s greatest pick pocket. Not only can he steal your wallet and keys but he can literally remove your neck tie and take the glasses off your face, without you noticing, all during what appears to be a normal conversation. It’s really quite amazing. So naturally when I got to speak with him I started wondering about how he can do things like take off someone’s wrist watch without them noticing, and I bet you’re wondering too. The Read more [...]

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Understanding Expectancy in Forex Trading

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Using Technical Analysis in Real Live Forex Trading

Today’s post will be focused on applying the steps of technical analysis in discretionary Forex trading. These steps have been laid out in a guide, which you can access here. For more information on trading the Forex market with less discretion, rules based, and a set and forget style, please take a look at this link.

STEP 1: SELECTING A PAIR

The Forex market offers a wide selection of currency pairs to choose from. Actually picking one of them is not always as an easy task. For today’s article I thought about analyzing plus discussing this week’s (after Monday’s price action) Aussie and Kiwi weakness, GBP slight rebound so far, and the CAD weakness. When scanning through the individual charts I decided to focus on USDCAD because price is offering interesting decision spots on the daily time frame. The formation of interest is the triangle chart pattern (blue trend lines); the bottom and top of the triangle are the decision spots.

STEP 2: IDENTIFY TREND

The trend on the weekly chart has been up: price built consecutive higher highs and higher lows (green circles) and price recently bounced off of the bottom channel line (green). The weekly trend is currently without doubt UP (also notice that the resistance line has been broken (red)).

The trend on the daily chart is also UP: price is moving up in an uptrend channel and it is above the 50 ema close as well (magenta). Furthermore price respected the 50 Fibonacci retracement level and its first target at the 27.2, which is a typical trending characteristic.

With the weekly and daily chart in an uptrend Forex traders can conclude that trend traders are in search of long opportunities, reversal trades are looking for smart shorts, and range traders are probably skipping this pair.

STEP 3: IDENTIFY PATTERNS

Let’s review the candle stick and chart patterns on various time frames.

Let’s start with the weekly chart. Last week closed bearish but the candle did not break the candle high and low of 2 weeks ago. I need to be cautious of the high at 1.11 which is the high of the last 2 weeks. No chart patterns.

The daily chart shows a pinbar formation on Friday at the 78.6% Fibonacci level and support trend line (blue). It also had a strong bullish candle on Monday (with a close near the high). There was also a previous chart pattern visible: an expanding wedge (purple lines). This pattern is quite rare and price managed to break above it in the meantime, adding to the bullishness.

STEP 4: IDENTIFY SUPPORT AND RESISTANCE

When I review the daily chart I am able to see that many resistance lines have already been broken. The trend seems to be the winning the clash with support and resistance. One line can be added to the chart (purple) but this trend line only has 2 hits. The biggest resistance could be last week’s high at 1.11.

CONCLUSION:

The uptrend looks strong at the moment. Let’s take a look at what spots traders can act:

1. Reversal traders could attempt shorts at the 1.11 weekly highs


2. Reversal traders could attempt shorts at the -61.8 target at 1.12 and weekly top at 1.1270


3. Reversal traders could attempt shorts upon the 4 hour shooting star (red circle) as price can always overextend in a trend (riskier trade)


4. Range traders would look for other pairs


5. Trend traders can look for longs at any of the Fibonacci levels (green box). The best is to wait for price action confirmation signals such as candle stick patterns at the Fibs (green arrow)


6. Trend traders could trade the break of resistance (red and dark red) but this will take some time before price retraces and breaks (purple arrows)

Do you agree with the above analysis and conclusion? Do you want to add something to the above mix? Let us know!

Thanks for your comments and shares, and Happy Trading

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EUR/USD – Shaky Euro Trading Close to 14-Month Lows

EUR/USD is stable on Monday, as the pair trades in the mid-1.28 range in the European session. The euro had a bad week and lost about 130 points, as the currency finds itself close to 14-month lows against the surging US dollar. In the Eurozone, there are no data releases on Monday. The markets will be listening closely as ECB head Mario Draghi testifies before the European Parliament Economic and Monetary Committee in Brussels. In the US, today’s only data release is Existing Home Sales.

Eurozone inflation numbers continue to float at anemic levels. On Friday, German PPI posted a decline of -0.1%, unchanged from the previous reading. The index has not managed a gain in 2014. Meanwhile, in an effort to combat deflation in the Eurozone, the ECB announced the results of its first TLTRO on Thursday. This lending program aims to bolster the economy by increasing bank lending to the real economy. The ECB said that the take-up by European banks amounted to 82.3 billion euros, which was well short of estimates that ranged from 100-300 billion. Still, it’s too early to declare the program a failure, and traders and investors will have to wait till the next TLTRO in December before reaching conclusions as to the scheme’s success.

The US economy may be much more robust than that of the Eurozone, but it is also affected by weak inflation levels. CPI, the primary gauge of consumer inflation, came in at -0.2%, its first drop since October. The estimate stood at +0.1%. Core CPI followed suit with a flat reading of 0.0%. This was the first time the index failed to post a gain since October 2010. The weak numbers follow disappointing manufacturing inflation data. PPI, a key event, dipped to just 0.0%, a 3-month low. The estimate stood at 0.1%. Core PPI slipped to 0.1%, down from 0.2% a month earlier. This matched the forecast. Low inflation continues to be a concern and could delay an interest rate hike in 2015.

Last week, the dollar posted sharp against the euro after the Federal Reserve policy statement. The Fed reaffirmed that interest rates would remain ultra-low for a “considerable time” after its asset purchase scheme (QE) ends next month, but surprised the markets in hinting that once a rate hike was introduced, rate levels could move up more quickly than expected. As expected, the Fed trimmed QE by $ 10 billion/month, and the remaining $ 15 billion/month is scheduled to be phased out in October.

EUR/USD for Monday, September 22, 2014

EUR/USD September 22 at 10:10 GMT

EUR/USD 1.2853 H: 1.2868 L: 1.2839

EUR/USD Technical

S3	S2	S1	R1	R2	R3
1.2518	1.2688	1.2806	1.2905	1.2984	1.3104

• EUR/USD posted gains in the Asian session and moved towards resistance at 1.2905. The pair has edged lower in European trading.


• 1.2806 is an immediate support level. It has remained firm since July 2013.


• 1.2905 is the next resistance line. 1.2984 is stronger.


• Current range: 1.2806 to 1.2905

Further levels in both directions:

• Below: 1.2806, 1.2688 and 1.2518 and 1.2353


• Above: 1.2905, 1.2984, 1.3104, 1.3175 and 1.3288

OANDA’s Open Positions Ratio

EUR/USD ratio is pointing to gains in long positions on Monday. This is consistent with the movement of the pair, as the euro has posted small gains. The ratio has a majority of long positions, indicative of trader bias towards the euro moving upwards.

EUR/USD Fundamentals

• 10:00 German Buba Monthly Report.


• 13:00 ECB President Mario Draghi Speaks.


• 14:00 Eurozone Consumer Confidence. Estimate -11 points.


• 14:00 US Existing Home Sales. Estimate 5.21M.


• 14:05 US FOMC William Dudley Speaks.


• 23:30 US FOMC Narayana Kocherlakota Speaks.

*Key releases are highlighted in bold

*All release times are GMT

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This article is for general information purposes only. It is not investment advice or a solution to buy or sell securities. Opinions are the authors; not necessarily that of OANDA Corporation or any of its affiliates, subsidiaries, officers or directors. Leveraged trading is high risk and not suitable for all. You could lose all of your deposited funds.

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John Locke: Learn how to become a professional trader through the M21 Options Trading System

Yesterday, John Locke returned to the Options Tribe to discuss how options traders can wind up on an options trading desk by becoming skilled at the M21 Options Trading System. Unfortunately the recording on the meeting was corrupted but we have the powerpoint available. Enjoy! The SMB Options Training Program is an eight-month program designed for novice and intermediate level options traders who are seeking an intensive training process to learn how to trade options spreads for monthly income. For more information on this program contact Seth Freudberg: sfreudberg@smbcap.com. No relevant positions Options Learn Read more [...]

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Free Options Webinar: Jim Dalton of JDaltontrading.com: How to use the Market Profile to Gain an Edge in Options Trading

Your Option for a better trading life……together (SMBU Options Tribe) SMBU’s Options Tribe is an online community of options traders dedicated to sharing successful options trading ideas with all of our members worldwide. Each Tuesday, SMBU hosts an options webinar—the Options Tribe—during which veteran options traders and experts in the world of options trading share live presentations. Tuesday, next week, Jim Dalton of JDaltontrading.com makes his first appearance on the Options Tribe to present how he uses the Market Profile in his options trading decisions. Options Tribe meetings are free to the public on the Read more [...]

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USD/CAD intraday technical levels and trading recommendations for September 16, 2014

The USD/CAD pair has been down-trending within the depicted bearish channel. This bearish trend started with retesting 1.1260 when bears initiated this extensive bearish impulse.

Two months ago, the bearish swing mentioned above was hindered at the price level of 1.0620. This price level corresponded to the lower limit of the channel as well as the backside of a steeper bearish one.

In August, bullish breakout off the movement channel took place. This enabled the current bullish Flag pattern to be established.

In one month, a bullish rally extended from 1.0620 reaching 1.0990 where the upper limit of the Flag pattern is now being retested.

Last week, the USD/CAD pair has established a recent consolidation zone between 1.0990 – 1.0850.

Four-hour fixation above price zone of 1.0990-1.1025 (50% Fibonacci level) confirmed the bullish flag pattern mentioned above offering a valid BUY entry.

Today, another opportunity to BUY the pair exists around 1.0990-1.1010 as the pair is currently retesting the previously broken resistance zone (it should act as support).

Projection targets are located initially around 1.1235 – 1.1270. SL should be located below 1.0940.

The material has been provided by InstaForex Company – www.instaforex.com

Forex analysis review

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Intraday trading recommendations for EUR/JPY for September 15, 2014

The pair successfully closed in the broken triangle, made a higher close. The pair opened today with a green tick, as of now, today it has been unable to breach the previous day’s high. On the upside, the pair has a strong resistance zone between 139.18-139.25 levels. We recommend fresh buying only above these levels. In the near term, the upper end on the triangle is the major resistance. A breach above that, we can see a sharp run up towards 139.80-140 odd level. On the down side, it has support at 138.34 and 137.30.

For an intraday basis, the prices are closed above hourly key moving averages. The pair has support at 138.65, below this, 138.40, 138 and 137.70 levels.

The material has been provided by InstaForex Company – www.instaforex.com

Forex analysis review

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Intraday trading recommendations on USD/CAD for September 11, 2014

The pair has been facing strong resistance at 1.0986 on a closing basis. Even though the pair breached this level, it is unable to close above that level which produces selling pressure whenever it touches that 1.0986 on a daily closing basis. In yesterday’s session, the pair drifted towards 23.6 fib level. Today, it opened with support at that level and is looking for an opportunity to move up. The pair is trading at the 1.0945 level, support existed at the 1.0934 level. Below 1.0934, it can extend its fall down to 1.0921 (20Dsma). For an intraday session, the prices are holding above 34hrsma. We recommend buying the cmp 1.0934 with an hourly target at 1.0965. In a move above 1.0965, it can climb up to 1.0983, 0986, and 1.1. Today, the key support exists at 1.0928 while resistance is at 1.0965.

Buy at cmp, strong up move above 1.0965.

The material has been provided by InstaForex Company – www.instaforex.com

Forex analysis review

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GBP/USD intraday technical levels and trading recommendations for September 5, 2014

One month ago, bears initiated a bearish trend off the price levels around 1.7150-1.7190. Since then, the GBP/USD pair has been declining within the depicted bearish channel.

The price levels of 1.7050 – 1.7000 failed to provide enough support for the pair. Hence, bears had an initial bearish target around 1.6800.

However, this price zone of 1.6800 – 1.6820 failed to provide support too. Thus, maintaining the downside movement within the depicted chart.

The current bearish destination is located around 1.6300-1.6250 which has been hit earlier today ( previous prominent daily bottom ).

In case bulls maintain the current daily closure in the form of a “bullish hammer daily candlestick”, a bullish corrective movement towards 1.6540 will be very probable.

Otherwise, sustained bearish pressure will expose the price levels around 1.6250 for retesting. It’s the nearest daily support to meet the pair

The material has been provided by InstaForex Company – www.instaforex.com

Forex analysis review

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Recording: Anne-Marie Baiynd: Iron condor strike selection and trading options using chart formations

Anne-Marie Baiynd returns to the Options Tribe to discuss the proper strike selection for iron condors as well as the use of technical chart formations to make options trading decisions. Enjoy the video! We look forward to seeing you at the meeting! Seth Freudberg Director, SMB Options Training Program The SMB Options Training Program is an eight-month program designed for novice and intermediate level options traders who are seeking an intensive training process to learn how to trade options spreads for monthly income. For more information on this program contact Seth Freudberg: sfreudberg@smbcap.com. No Read more [...]

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Price Action Trading Forex in Low Volatility Conditions

Last night I held a webinar on trading Forex in the currently low volatility conditions we are experiencing. Below you will find the webinar along with extra information.

In the last few months, Forex has fallen to a period of extremely low volatility. At the moment, volatility is going back up. However, it will be a long climb before volatility reaches mid 2013 levels again.

For me and the forum members, these conditions have been fantastic. A lot of people see low volatility as a bad thing. However, if you know how to trade in it, low volatility can be great.

Why is low volatility great?

Well, one of the biggest reasons is that there are less surprises. Low volatility markets are much more relaxed and much more predictable. You may make less pips, but who care about pips…

… As a Forex trader you don’t measure your success in pips.

If Bob is making $ 100 per pip and Time is making $ 10 per pip, Tim needs to make 10x the pips Bob has to make to equal Bobs profits. You calculate profit and risk based on a percentage of your total trading capital. Since you can have much tighter stops in low volatility conditions, you can trade more lots. So less pips will equal the same amount of money.

Low volatility has been causing issues for a lot of traders. If you look at Forex forums, or trade following services, the performance of many traders has gone downhill.

Why?

Because these traders do not know how to adapt to current market conditions.

Adapting your trading to current low volatility conditions

One of the best aspects of trading price action is that price action works in all market conditions. There will always be a few changed you need to make, but with price action those changes are minor.

The main changed I have made to my strategy in the last few months are as follows.

• I have tightened my stops and targets.


• I have tightened the space between my support and resistance areas.


• I have been adjusting my support and resistance areas weekly as opposed to monthly.

These are all the changed I had to make to adapt to current market conditions. In the video below I will show you my strategy in action. Before I do that, I want to talk a trade that a viewer of the webinar alerted me to during the webinar.

The EUR/GBP Long

After last nights webinar, a whole lot of trades triggered. This was no surprise as the massive move caused by the European interest rate news had to retrace at some point.

During the webinar, a webinar attendee spotted an awesome trade set up on EUR/GBP and asked me to check it out. This can be seen at around about the 37 minute mark on the video. Below is an image of the set-up during the webinar.

This was an awesome reversal set-up. I was in two minds about entering it as NFP was coming up the next day. However, in the end I jumped in for a quick 23 pip gain.

I ended up entering this trade in bed at around about 6:00 am my time. I waited for price to retrace to around about 0.7927. I only entered this trade because I could get a very tight 10 pip stop on it. My first target was at the blue dotted line, which was 0.7952. Since NFP was nearing I ended up closing the full position at 0.7952 instead of holding out for a second target.

So, thanks Andrea for spotting this trade in the webinar!

An important thing to note about this trade is that I did not make any changes to my normal position size. So technically, this trade was not a huge gain. What do I mean by this?

Well, let’s imagine I normally risk 0.5% of my account on a trade with a 30 pip stop and a 60 pip target. If I have a 10 pip stop and a 25 pip target, I would still risk 0.5% which means I would need to trade more lots. In this case, I did not change my lot size, so the 25 pip gain was more like a 15 pip gain when compared to an average trade. Either way, profit is profit, so I am happy with the trade.

Some of the other trades taken on the forum were EUR/USD 8hr long and USD/CAD 6hr short.

We do not normally trade this close to NFP. However, for me, it was really hard to pass up on the opportunity to make some quick profits from the retrace of yesterdays fall.

Trading Forex in Low Volatility Webinar

That was pretty much the longest written introduction I have ever done for a webinar. I hope you got through it all though, I know you are anxious to see the webinar, so here it is…

My Free Price Action Strategy

If you want to know more about my strategy and how I trade, here are a few links.

• Check out the Free Price Action Strategy section for a break down of my strategy.


• Recent webinar on candlestick analysis in my strategy.


• Recent webinar on how I place and use support and resistance areas in my strategy.


• Recent webinar on how I use support and resistance together with candlestick analysis to enter price action reversal trades.

Questions?

If you have any questions as them using the comment form below. I try to respond to every comment.

NickB’s Forex Blog

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