Hello traders!
Firstly I apologize for not having uploaded yesterday’s video any earlier but the trade was still open by the time I went to bed. Anyway, I woke up this morning to see it stopped out for -59 pips.
It was a short trade on EURAUD H4 setup and in fact I still think it looks good despite the sour loss. The EURAUD has been breaking through levels of support in the direction of the MAs for about two weeks already. Yesterday I saw an upward retracement trendline giving way to the downside and I hopped on board for a short entry. Truth is that it actually moved to my first target rather swiftly but I decided not to trail my stoploss to breakeven just because there was not enough breathing room to safely trail down my stoploss. You know, a trade needs a little bit of wiggling room and it’s usually not a good idea to set your stops too tight.
So, I left the trade open and exposed and eventually it turned out to be a bad idea: the trade retraced almost a hundred pips overnight and it slapped my original stoploss level for -59 pips. Oh well…
Now the key pivot to watch is the 1.6625 support levels. Should price dive through it I will resume searching for short entries on that currency pair once again.
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29 April, 7:20 pm
I know what you mean, I got popped on the GBP/CHF pair, I was riding a nice 51 pip profit and it retraced back on me ( of course in the direction of the daily trend) but it was showing a nice uptrend on the hourly so I took a chance and ended up closing at -12 pips, so it went on it’s merry way for another 324 pips in the driection of the daily trend. And I got up at 2:00 AM to catch the London open. All well I will get’em next time. There is another 2:00AM coming :)
Brian
29 April, 8:07 pm
It’s so nice to hear everyone accepting losses and looking forward to more profitable trades
Are you a fulltime trader yourself Brian?
Hector I only managed to squeeze +37pips out of the trade and it was not skill, it was just my luck I guess. I got in at 1.6694 and shorted till I got a phone call at the office and decided I better get back to work and enjoy the position at 1.6661 (okay, so I lost most of them on another trade I took in the afternoon on the EURUSD) So like i said……
I had been following the AUDNZD on the 4hr timeframe and got a pop from the 1.2000 level so I decided to take a quick long entry at 1.2022 and just closed it manually moments ago at 1.2064 at +42 pips
One thing I cannot understand in this game: Why is it that when I take larger lots, my broker seems to notice and stops me out. When I take idiotic 1$/pip trades, I win 90% of the time. Is it pure coincidence ? I don’t think so!
Nonetheless, on a sidedish, I am spotting a textbook consolidating upward forming triangle and am hopefully waiting for it to collapse to the downside, shorting the USD (will the news at 08:15 potentially give me my big break) ?
Take care guys and keep this blog rolling! Nice work hector!
-Daniel-
29 April, 8:41 pm
I have to admit I experienced exactly the same situation. I did consider moving my stop/loss due to the lack of momentum/follow through we have been seeing lately, but decided against it as it seemed to move quickly to the first target.
Looks like the banks are holding onto their purse strings at the minute and its especially interesting as in the UK many have not yet declared their liquidity positions even RBS (a major bank) just issued a load more share to try and raise extra capital/cash…hmm hope this chill thaws out soon.
Nic
29 April, 9:27 pm
Daniel,
No I am not a full time trader, I am an electrical Design engineer, I took Hectors course awhile back and have had really good success with the method. I just get up early in the morning and look for the setups to break in the right direction and I just plain got tricked on that GBP/CHF pair even though I knew it could happen at any time I took a chance and went long when the main trend of course is down, so I took a guess that it would continue up for another day but it had other ideas.
Brian
29 April, 11:13 pm
Gentlemen I have a small question that may sound like nonsense at first, but I’m sure most of us have tried it at some point in our trading careers:
Instead of waiting for a good trade (daily or 4hr), waiting for all signals, so on and so forth, would it be possible to take miniscule trades (1,2 pips profit per trade)? You still use Hector’s wonderful 3SMA system of course, but on a 1minute chart?
Won’t this work too?
-Daniel-
29 April, 11:39 pm
Hi folks,
same adventure!
I got stopped out on euraud at 167.10 overnight, retracement started at the end of london session, but I was hoping that the 1.6700 would hold.
So bad if you start your trading day like this, icks :-(
Roman
30 April, 1:20 am
Daniel,
Personally I would avoid the lower times frames as they are very unpredictable.
Also with spreads (basically like a dealing commission) as they are, starting from typically 3PIP and going upwards you need to be able to back a reasonable move just to break even.
To make if profitable would require much larger stakes or stacks of trades - either way it will tire you out chasing trades like that.
Trading is just the way it is at the minute, as my guide used to say “wait for the trades to come to you” or as hector says “patience young grasshopper” things are just the way they are - its part of the cycle and all cycles (trends) start and end - I’m personally waiting for this one to end (soon!) and the next one to begin ;-)
Nic
30 April, 1:41 am
Hi Hector,
Just wandering if you considered placing your stop for you EUR/AUD trade yesterday, above the previous resistance level of 1.6780, as this appears to be relatively firm resistance and would have given your trade a little more breathing room?
I know you are out of the trade, but just wanted your opinion on the stop placement?
Thanks,
David
30 April, 9:45 am
same here !
i got stopped out on euraud but i is a necesarry loss cause all the sma are paralel the level confluence is on our side and forgot to mention the fib retracment so it was a necesarry loss according to the system. but i did notice recently we got a lot of false breakout perhaps its have relation with the low liquidity market (like a range bound market).
i thing scalp is not a good ide since the cost of spread will eating your account badly, i stick on m30 > to base my trades and im confortable with it.
regards
30 April, 1:03 pm
Hi everyone!
Let me try to address everyone’s comments:
—–
- Daniel: Looking into AUDNZD H4 I can clearly see the uptrend you’re referring to. However price action is not that pretty. Let me explain myself: do you see all those short bars with long wicks? that usually scares the hell out of me because they are prone to false signals. I like to trade long bars with full bodies as they usually signify that there’s one main force (either bulls or bears) driving the market. When the individual bars wick sharply both to the upside and to the downside it means that the outcome of the battle is rather muddy. As it stands now, I will wait for price to retrace to the Dynamic Area of support and I will see how price reacts for that area. Hopefully we’ll get new long opportunities there.
- Brian: glad to hear you’re profiting from my course! Now, I have the GBP/CHF chart in front of me and I cannot see what exactly triggered your long entry. Could you please elaborate a bit further so I can give you my insight?
- Daniel: regarding applying my system into the micro-time frames (you mention the M1 charts), I must say that my system should in theory work as well since trading breakouts in the direction of the trend (basically what my whole system is based on) is an universal principle. That being said, I have not been able to achieve consistency while scalping. I just cannot make it work, maybe I am not skilled enough as a trader. If you truly want to scalp, let me give you three tips: futures market (cheaper transaction costs), London and NY open (high market push) and momentum breakouts (even stoploss hunting). It’s the only way to scalp successfully.
- Roman: seems like you took exactly the same trade as me. Don’t beat yourself, trading does carry a component of randomness and there’s not much we can do about it. What it’s important is that our trading decisions are sound and make sense, regardless of whether the trade made profits or not. If your trading decisions make sense, you will make money in the long run.
- Nic: Absolutely! patience and seizing the opportunity is crucial for trading. I am not sure which quote I like better though: either “patience, young grasshopper” from the TV series Kung-Fu (David Carradine) or “be like water, my friend” from Bruce Lee :)
- DJS Trader: I have an article about stoploss placement on my free NewsLetter. Basically, my point on stoplosses is that there’s no need to over-stretch your stops. If the very event that got you into the trade (in this case the breakout-pullback-continuation pattern of the retracement trendline as explained on the video) is violated, then I don’t want to be involved in that position anymore. I’d rather exit out with a small’ish loss knowing that I can hop onboard again in the future than holding a losing position open in hopes that it will turn around.
I mean, I trigger my position because of one particular reason (that BPC pattern). If that pattern is no longer valid, how can I justify holding that position open?
- Juan: I agree, markets have been tricky as of lately and we’ve had a few fake breakouts. This type of market conditions do happen every now and then and it’s important to not desperate and keep our heads cool, trying to navigate our way through the storm and monetizing our positions as much as possible once the dust settles - I know, I know… easier to be said than done :)
—–
WOW that was a whole load of stuff I just typed out. Sorry for the rambling guys :)
Cheers,
-HECTOR-
30 April, 3:24 pm
Hector,
The GBP/CHF trade was was based off of the hourly chart, it was clearly a mistake on my part and not the method, there was an uptrend on the hourly chart I placed the trade on the trigger chart, but also if you look the pullback is what never ended and hence the -12 pip loss. SO it is extremely important to ALWAYS wait for the pull back AND continuation, this trade could have been winning trade as the pair did move in the direction of the daily trend, and that is why the pullback never surfaced because the pullback was actually an impulse wave and I did not wait for it to develop.
-Brian-