Every week I publish free Forex setups that have the potential to trigger and deliver a trade. There will be times that my bias, taken from the overall market context, will be one direction but price will venture in the other.
That does not invalidate the idea of the trade.
My hope is that traders can learn from the charts, the commentary, and the price action that results.
- Not every setup will trigger
- Not every triggered trade will work
- Most trades will give you the opportunity to remove risk
I do my own homework that is garnered from price movement and patterns that have a statistical edge in the market. Putting my thoughts online also opens the door to those who believe that even a negative comment is better than no comment.
They are wrong.
I recently had comments from an individual, now banned from posting, who was rude and showed that he has no idea about expectancy, and possibly no idea about trading.. He even told me “guys like you give trading a bad name”
It started with a week where many of the setups did not trigger. In fact, they did start to pull away from the setup which costs a trader nothing. I wrote a post that you can read here that takes a segment of his comments and goes over each point he made.
EURUSD Makes The Move
His initial comment and the subsequent ones were centered around the EURUSD. I thought it would be a great lesson to bring up the current EURUSD chart and see how things are playing out.
For disclosure: I’ve been wanting a long on the EURUSD since mid-December for a variety of reasons on the higher time frame charts.
You can see the week of Dec 25 where I post the weekly EURUSD trading chart here. (Things have changed since that post and opportunity presented itself)
Here are a few other comments from him:
- and with news of the intrest rate increase in the US it looks like it could fall into the 1.1630 zone.
- you predicted a log set up and EVERYONE else is suggesting short positions to 1.1630.
Remember, this guy was saying that “everyone” was calling for shorts and that I give traders a bad name. This chart highlights his comment and where the chart was when he posted them.
This post is not to point and laugh at this guy. I’m sure he’s looking at these charts, realizing how silly he looks, and perhaps that he really doesn’t know too much about trading.
I imagine he doesn’t think that the “everybody” that was looking for shorts to 1.1630 give “traders a bad name”. Just me. The one who wanted a setup long because that is where the market was tipping its hand.
I would like a long now off the weekly chart but there has not been an opportunity as of this post to jump in with a long.
No,the point of this post is more important than proving someone incorrect.
Do Your Own Trading Homework
The point where someone has to get confirmation from outside sources is the time they should think of quitting.
Would I care that “everyone” wanted a short?
No.
In fact, I could not care any less what other people are looking to do in the market. If this guy shorted, he either scalped a few pips or lost.
You can trade the opposing direction in any market but the context has to be there. There must be a reason to think the imbalance is there…that the market has overstretched to the point there will be a decent counter move.
But do not let the opinion of anybody dictate what you think or do in trading.
Do not let the need for outside confirmation of what the chart is telling you dictate your trading business.
Can price trade back down? Absolutely.
As a swing trader however, was there an opportunity for the long if that was the intention? Absolutely.
What appeared to be happening on the daily chart was a messy complex correction to the downside. My initial setup was connecting the two highs and looking for strength. Strength that never came and that is why a trader did not have risk in the market if they were playing my posted chart.
Would I have taken a short?
No. Not in that move down.
A short on the daily chart (I swing trade daily charts) for me would have needed some type of momentum divergence, exhaustion – either daily or weekly – that pointed to a short trade.
There was none.
Outside confirmation would have had me taking a short trade (because “everyone” was calling for it) that would have been short lived on the daily chart and not a high probability trade.
Intra-day charts may have given some type of setup that I would trade…but I don’t trade intra-day. I do use the four hour chart for entries however.
How To Trade The Posted Setups?
You can use the charts to highlight potential pairs to trade. Once they break from the pattern, you can use a number of the trading strategies found on my site.
For example, 34 EMA Scalping With Trend Lines Strategy could be used once price starts to make it’s move in either direction.
You could also take a look at Trendline Trading Strategy which is a simple Forex strategy that can also serve a purpose.
By using any of strategy, you are one step closer to being able to trade without needing confirmation from other traders.
In the end, you must learn to do your own trading. Learn to depend on only yourself.
This picture was taken on a recent trip to Cancun – this was the Hyatt Zilara.
When you have confidence in your own work…when you are trading with an actual edge, you can sit on this balcony, set up your trades…..and then head down to the cabanas below and sip a frozen daiquiri while enjoying the sun, sand, water.
If you need to depend on the opinions of someone else, you will never get to the point where:
- You are trading with a statistical edge (after all, how can you quantify what they are saying?)
- You trust in your own ability to make money
- You don’t find the need to attack someone else to boost yourself up
In the end, trading is a meritocracy.
is a political philosophy which holds that certain things, such as economic goods or power, should be vested in individuals on the basis of talent.[1] Advancement in such a system is based on performance, as measured through examination or demonstrated achievement.
You will have to earn your way. And if you are wondering…”will you take a short?”
It depends on what happens at these highs but as written above, a few things have to happen.
Have a great new year – and get to work!