Start of week analysis and direction.

Lt Sweet Crude Oct Fut – Boss Hanging Man below the Major UP TL at 69.00 level. Only short if Hanging Man low breaks. Daily shows BEOB. 67.00 is the major Level so wait for PA at this key level.

Nat Gas – Boss 'Barb Wire' at base of long down move – wait for resolution.

Gold – Up trend still intact. At key $1000 level. Only trade long but bear in mind we could be at a top after 2 strong TL breaks this could be a higher high.

DowJones Sep Fut -(YMU9) – Up TL still intact. Boss trapped under the Big Boss 20ema. PA is at top after 3 pushed up ending in a doji. Poss top. Wait for PA and TL break to go short.

FTSE Fut – Boss chart still bullish, Up TL still intact. Also had 3 pushes higher; daily on HM and IB. Poss market top. Wait for TL break and test before short.

Cable – Trapped under Monthly 20ema and at major down TL from high thru recent shooting star. Daily on Doji under up TL break. Poss LH after a TL break. Short below Doji.

Gbpyen. - Now had 2 TL break and the boss hammer last week may have trapped traders. PA stuck under boss 20ema but over boss 50 so in the TRAP. Wait for PA but with the TL breaks and double top, only consider short.

Gbpchf - Had 2 major up TL breaks and PA is still trapped under the minor down TL after a lower high. Boss bearish candle trapped under 20ema. Worker shows a BUOB then an IB. Also a triple bottom. Only short if that bottom is broken.

Eurusd – Broken out of triangle BUT has rejected 61% fib. Large bullish candle on boss but there is a daily Shooting Star on worker at this key LEVEL. Poss FAILED B/OUT Short below Star.

Audusd – Major up TL is still intact on boss with bullish PA. Worker shows Doji but poss Barb Wire – wait for PA but don't bet against the boss.

Usdchf – Boss has broken thru major levels and up TL's after BEEB. No trade here.

Usdcad – Bearish PA BUT we have had a LOWER LOW after a down TL break; PA is battling at the low and had now been supported by the broken Down TL and is now in Barb Wire. Price is also still BELOW the major Broken UP TL from the boss but the down TL support has given us a higher low. Leaning toward long but wait for resolution of BARB WIRE.

USDYEN – Major down TL's have been broken and PA is very bearish. Very steep minor down TL but the last low of the UP TL has been broken. Short only on retrace.

Euryen – Major UP TL has been broken and tested from underneath. Last boss candle was a hammer but this week gave a loose IB. Only short on retrace with good PA.

Eurgbp – Major UP Trend is still intact with minor DOWN TL now broken and poss tested. Worker gives us a HIGHER LOW and a hammer. Boss gives an Inverted Hammer. LONG ONLY

Eurnzd – Boss minor down trend still intact and now we have the MAJOR up tl broken. Could be a failed BO – Worker shows a down TL break then a lower low. Intersection of the 2 TL's. Wait for PA to decide but side with Short until proved otherwise.

Gbpcad – Messy. Still in a down Trend. Major up TL's have been broken. Large S Star on boss last week and this week an IB. Wait for break of IB but side with short.

Nzdusd – Boss is still in major UP trend. Broken thru 61% Fib retarce could be targeting the 77% retrace at 0.7386? Major UP TL's still intact. Looks too long to get in so, sit this one out.

Audyen – Boss chart in major Barb Wire – had a major up TL break then a higher high. Fallen back from this high and given a BEEB but still above UP TL. Worker shows caught in the 20/50 trap but last bar was bearish. Only short below 76.60 (break of 2nd Up TL and last low of the up trend)

Audnzd – Only short below 1.2080 below major up TL and the break of the last low of the Up Trend. Caught in a down trend channel but could be a big bull flag.

USDCAD

Still long usdcad - just. The gold order short was never triggered. The indices are looking weak now with a big BEOB on the 4hr futures chart. So, down 58 pips on that trade today.

Levels

Forgot to say ref last posts as they are counter-trend at this moment I have limit orders in at the next SR levels. Once a new trend is established on each pair then I will have the confidence to allow each trade to run. I'd do this by waiting for the trend line Rule of 4 to be established then look for a PA entry in line with the trend.

ETX Account

Well, took advantage of a free £100 with ETX Capital today. I have a short order in for gold on the appreance of the daily Shooting Star at $1000 level and a long usdcad order above the daily hammer.

See chart:

Mon FTSE Stopped out

No trading today - FTSE order from last week was stopped out for a loss. On reflection I should have never went short this market as the major TL (daily) had not been violated or even tested. Do remember NEVER to trade against the major trend - because you are trying to enforce your EGO onto the market and thinking you are better than what the CHART is telling you.

You will never become successful unless you TRADE THE PLAN. Period.

Close on Friday

Well, not an ace week but what would one expect in NFP week? Still short FTSE and still short audusd after an 1hr S Star entry this evening.

Stopped out of eurgbp (after closing out 50%) and then stopped out of gbpchf. Will wait for a better DAILY entry once back on the plan next week.

1hr and 4hr TFs????

What are these TFs Daniel?? 1 and 4hr? what happened to the dailies?

No panic - I'm on leave this week and I'm selecting the best trades (non-usd) on the daily and waiting for tighter entries on the MIN 1hr TF - No Lower - so I'm not hunting the lower TFs more gaining a tight entry based on 1hr and 4hr SR levels and PASR in the daily direction. All this because I have time this week.

Back to work next week so no matter what - back to the daily TF as I'll only be looking at the charts for a quick 30mins after 2200UK time each evening!!

Pulled or rather stopped out of audusd - I moved the stop last night to the top of the daily IB and was taken out today - small profit and I'll wait till after US NFP on Fri and Labor Day on Mon before entering the market again.

I've initiated a small short position in gbpchf based on the pullback and textbook 1hr Shooting Star. Been looking for an entry into this pair - just hope that NFP leaves this one alone. IMF warned today that the UK was the worst placed country to pull thru the recession too; that should help this piece of crap sterling plummet and also help my other 12 pip risk position long eurgbp that I took this evening on the appearance of H4 ii candle formation at the weekly 20ema. I'm pretty sure we will see another attempt on the big down TL - hoping for a break thru with such small risk (12 pips) that I risked £2 per point. Again, could be risky with NFP but I'm hoping these pairs are left alone unless CABLE messes the party up tomorrow?? We will see!

Here's the AUDUSD chart that I was in today from the daily entry. This shows the power of the smaller 5m trades and although I never trade the 5M you can learn here and apply the same princiapls to the daily charts.

New trade - Long usdchf - in at 1.0600 stop at 1.0539 (below base of 1hr hammer)

Stop was hit by 2 pips then Cable plummeted over 130 pips :(

End of month fixing caused a wobble for the dollar which fell at the same time as equities and crude and killed my sterling trades

So That's what is was then!

Cheers Nic

Well, went live with three trades today:

1. Cable short at 16238 Stop at 16353 above BEOB the reentred on 15m S/Star stop at star top.

2. FTSE Fut short at 4880 Stop at 4950 above 1hr S/Star

3. Audusd short at .8365 stop at 8476 above dly S/Star

I knew I should not have entred the Cable trade as there was a 4hr Pin against it. But like a mong I did it anyway. What happened to trading reversals with first having a TL break then strong move back to that TL high or LH or LL?? PATIENCE!! The daily cable was a clear example of Barb Wire. NEVER trade barb wire! Again! Right!

See charts below:

I just thought I'd share with you this weekend some of the stuff I have learnt over the past couple of weeks with regard to trend trading and counter trend trading. When I started out (4yrs ago) I was trading blind just looking for a chart was that going up and buying because it looked good. I won a bit and lost a bit. Then I came across Trader_Dante's thread Making Money Trading over on T2W which I found to be a revelation. I had never considered Fibs and SR levels or even individual candle patterns and I was amazed that some good soul had taken the time to show new traders how and what the market did and why. That thread and the J16 thread really got me interested in the markets and trading, but I STILL thought I knew best and tried 'fitting' many silly indicators and lines to my charts thinking I could get the march on the markets. I have a shelf full of trading books all about RSI, MACD, Force Index, Convergence, Divergence etc and I filled my head with all that senseless crap. So then I started to 'give' the markets my cash as I found my little systems never stood up in the live market. Great in hindsight but crap in practise. So, then I went back to 'pin bars' (hammers and shooting stars) and re-read Tom's thread over on T2W. I had some success but I still didn't seem to be making it as a trader because I was programmed to be a counter trend trader without having any real idea what a trend was in the first place and when that trend was broken. To me, this is the BIG danger with learning some of these formations unless you RIGIDLY stick to taking them as fades (ie reversals back INTO the main underlying trend). This was my big undoing as I was trying to trade every hammer and shooting star always looking for those 1000pip plus moves at the top or bottom of a big trend break. So then, in Jan of this year I came across another 'thread' and some pro's down in Spain who had set up a live room with a special chart set up. Now, although I couldn't trade in their way, I did learn am few things from them guys like the importance of the 20 and 50 mas (I'd never used them before) and the ability to set MT4 up showing some of that info across the charts (ie Boss MAs on the worker charts). Their system was not for me as they used 'averaging' candles that HID the PA from traders. This seemed odd to me; why would you 'hide' the PA? I also found that the heiken ashi candles were only good after the event and didn't trade well live. And as for the 15min TF - Well, we all know how stressful that is!! But, I did meet some good people there and I'm still in contact with a few of them today, so there are many positives to that experience including my friend introducing me to this thread back in April 09. Since coming across this thread and Strat's instruction I feel I have learnt much more about trading etc in the past few months than the previous 3 yrs! The odd thing is, I already knew a lot of it and debunked it because I wouldn't believe that trading could be that simple. Well, I can save you a few years and a good few thousand pounds/dollars etc and tell you that the only way to trade and mix it with the pro's is with PRICE ACTION. This is the 'grail' to the markets. Why don't many people learn this stuff? Well, I reckon some see it as too hard to bother with and would rather have an EA tell them when to trade. It could be that some people think it is a lot harder than this (I did) and look for complex systems. Learning PA may seem like a hard slog but believe me, once you start to see the PASR you can have a little chuckle when you read a chart because you can see what may be about to unfold (I say MAY as there are no certainties in this business). Lets looks at the chart below to illustrate the point. The chart is the FTSE Fut chart As you can see the FTSE is in a strong up trend since Mar 2003 and if you wanted to make money all you had to do was buy on every dip to that Trend Line(TL). All the MAs are in the right order too, so we would never consider shorting this market. The key to making money is identifying a trend early on and the sticking with it. Once you have a low then a high then a higher low its time to jump on board. Trends often go on a lot longer than people think. As you can see at Point A, the market broke that UP TL; this was our first warning that the bulls were running out of steam and a trend change could be in the offing. Now, most TL break need confirming with a test and sometimes these tests will result in a higher high (Point B) or a lower low (in a down trend). What we look for here is a reversal pattern (we are now looking for a short because of the TL break) and in 14 Oct 2007 we had a BEOB. Now aggressive traders may take this setup as their short. The more conservative amongst you may wish to see the test of the break of that TL from underneath before you traded. As you can see at Point C we had a test of the TL break from underneath with an Inside Bar. IBs are dangerous but they are best if they trade in the way you expect them to go. So, if you are looking for a short you would not take a green or bullish IB break. But that's not being taught on Strat's thread so I'll zip it!) So, we have now had effectively a 1-2-3 set up. We have had a major TL break, a new high back into that TL and now we are looking for the 123 to get us in. We had this with this double top, (1) the back down thru the TL and 20ema (2) then back up to underneath the TL with a lower high (3). [B]This is a text book short set up trend reversal. [/B] We then had another TL test (the final UP TL) drawn from the March 2003 lows to the Aug 2004 lows and beyond. Look at how that TL break in Jan 2008 was tested from underneath in May 2008. This time we had a BEOB. This was also a 'Low 2 Short' (ie the 2nd lower high after the peak) and this gave rise to the best short of the lot with 2 large pushes down to the MAJOR yearly up TL at 3700 region. Point D is the down trend line from the peak thru the Low 2 high and beyond. Until this TL is broken we are still, really, in a down trend and this current thrust could yet be a retrace back into that TL. The current chart is showing a steeply rising wedge pattern and the current rate of ascent is unsustainable in my opinion and a test of the monthly 20ema. I think once Sept Oct starts we could see this rally peak at about the 5000-5100 level before starting a new leg down. Again, wait for the micro TL break (ie the lower part of the wedge pattern) and the retest of that break before going short. Al says in his book that most market moves involve 2 pushes down and 3 pushes up. If this is the case then we may see some corrective action this week or next before a final small 3rd push up into that descending TL and the 5100 region before the resumption of the down trend. Hope I've not got above my station here or explained this well enough for people to understand; I would invite comments to the contrary for learning of course!

No Trading today after being busted yesterday. More chart reading required. This week I have learnt the importance of sticking with the trend. Only take a counter-trend trade once it becomes the new trend (after a significant TL break, a retest to a lower low or higher high) then the resumption of the new trend!

Dollar May Fall as Rebound in Oil, Stocks Triggers Stop Losses

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By Ye Xie and Oliver Biggadike

Aug. 28 (Bloomberg) -- The dollar may extend its decline against the euro on reduced demand for safety after crude oil and U.S. stocks rebounded, encouraging traders to sell the U.S. currency to limit losses.

The Canadian dollar advanced yesterday against its U.S. counterpart by the most in two weeks as crude oil rose after failing to sustain a drop below $70 a barrel. The Norwegian krone also gained. The dollar depreciated versus most of its major counterparts, declining to the weakest level this year versus the Swiss franc.

“The turnaround in oil and equities set off the moves in commodity currencies,” said Alan Ruskin, head of international currency strategy in North America at RBS Securities Inc. in Stamford, Conn. “Long-dollar positions have been stopped out big-time.” A long is a bet a currency will appreciate.

Looks like the black gold is still in charge then!

Well, got busted out of all three trades today by the superspike that started about 1600? Was it oil or the indices that gave to the rise? Oil, gold up and usd down.

To be fair I should have know as the 15m TF Cable chart put in a double bottom. The moral of the story is not to trade a TF that you can't be present at the screen for. You can't trade a 15m TF if you are away for a few hours as things change quickly.

Todays open trades (held overnight)

Nat Gas chart - there is a massive divergance between oil and gas - one has to give way soon? The best pairs trade maybe long gas, short crude.