“Proper market speculation is simple; actually having the right knowledge and discipline to do it is not easy.” – Sam Seiden
Hello:
Truly, the Forex markets are the best trend markets that exist. That’s why your long-term survival is guaranteed if you’re a trend follower and in the habit of letting your profits run. You can’t go broke by taking quick and small profits, but you can’t get very rich doing that either. Great profits come from strong trends. Then I’d always implore you to keep your risk low (even if it means risking 0.2% of your account to aim at 0.6 % profit!). With this, you may suffer several losses in a row without any significant ruin on your trading portfolio. High leverage enables traders with little capital to make big money – albeit big losses, too. You need to constantly put it in your mind that, in order for you to win, someone else has to lose. Ultimately you alone determine on which side you’d end up.
Below is the summary of some my trading activities this week:
AUDUSD
Primary Trend: Bullish
The pair is presently caught in what looks like a consolidation phase. Could the price rise from this phase or fall? The latter scenario is more likely, for the price found it difficult to break 1.0580 level before retracing. Any remarkable changes in the current fundamental outlook would cause a steep fall in price (provided buying pressures thin out). Please prepare for that opportunity.
NZDUSD
Primary trend: Bullish
I still have a long trade on this pair, the Kiwi being a very strong currency at the present. I entered this order when there was an overbought indication in a lower timeframe. What you think is a late signal in a lower timeframe may in fact, be the beginning of a long-term trade in a bigger timeframe.
Order: Buy
Entry date: April 5, 2011
Entry price: 0.7681
Stop loss: 0.7481
Current stop: 0.7836
Take profit: 0.8279
Exit date: N/A
Exit price: N/A
Status: Open
Profit/loss: 247 pips
EURCAD
Primary trend: Bullish
I have a long trade on this cross. It’s still open and the risk on it has been eliminated already. Based on my expectation, the Loonie might only become weaker; something that can sustain the current trend outlook.
Order: Buy
Entry date: April 5, 2011
Entry price: 1.3741
Stop loss: 1.3541
Current stop: 1.3741
Take profit: 1.4333
Exit date: N/A
Exit price: N/A
Status: Open
Profit/loss: 182 pips
EURAUD
Primary trend: Bullish
There’s a serious threat to the current bullish bias, and a few more days of bearish pressure could change the overall trend. This market currently looks flat, so it’s sensible to wait for the price itself to confirm its own direction. We wait for what’s worth waiting for, and in the process we learn patience.
EURNZD
Primary trend: Bullish
I can say that we have a very convincing bearish signal in the context of a primary uptrend. The price is still below the SMA 20. The ADX 20 level is now close to 40 and showing a strong trend. +DI has maintain a constant move below its –DI counterpart. What I said last week about the cross has come true. I said it was possible for this pair to continue its southbound journey, because it was clear that the strong Euro couldn’t withstand the stronger NZD. The bullish bias might soon be rendered invalid.
AUDJPY
Primary trend: Bullish
Earlier today, I opened a short trade on this cross. The AUDJPY has gone up too far, and has experienced a bearish reversal. If this doesn’t prove to be a correction, then it’d be the beginning of a nice bearish ride. The Yen may strengthen with alarming ferocity.
Order: Sell
Entry date: April 15, 2011
Entry price: 87.83
Stop loss: 89.83
Current stop: N/A
Take profit: 81.83
Exit date: N/A
Exit price: N/A
Status: Open
Profit/loss: 1 pip
Conclusion: The study and the use of candlestick patterns in trading is good. However that isn’t any Holy Grail. In the long run, you’d hardly achieve over 50% accuracy with it; just like any other trading systems. “Many idealized candlestick patterns to be found in textbooks that have been used by analysts for decades, don’t work. Under certain circumstances, some even have the opposite effects,” observed Christian Lukas, a highly experienced trader. What makes the study of the candlesticks to be more complicated is the fact that a defined pattern may consist of several individual patterns. For example, what appears as a Doji on a daily chart is made up of many different patterns in lower timeframes. A key to easy trading life still lies in keeping everything very simple. No matter what analysis you use, you’ll sustain an eventual probability distribution like everyone else, and therefore, you still need to let profits run; otherwise you’re inevitably involved in self-sabotage.
I end this article with the quote below:
“In trading, as is the case with piano playing, certainly not everybody will get to be a virtuoso, but all those who make serious effort are quite capable of achieving decent results.”
Your questions and opinions are highly welcome.
Thank you.
With best regards,
Azeez Mustapha
Forex Signals Strategist, Funds Manager &Coach
Senior Analyst
FX Instructor, LLC
Email: amustapha@fxinstructor.com
Are you facing any challenges in trading? You might want to explore the secrets of markets wizards and duplicate their success. Get the secrets from my past articles at:
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NB: There is risk of loss in trading, but it is possible to be a successful trader.
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