It all comes to the reasons why to take your trades…
It needs to be a sound reason, you need to have a methodology so you can determine what risks to take and which ones to avoid…
You cant take a trade because:
You simply thought the market was going up
You followed some one else’s advice
You got influenced by a market analyst
You saw the oil price moving up, etc
The idea is to get in a trade when the odds are on your favor, when the likelihood of the market of moving in one direction over the other is greater, when you’ve got a either, a very good profit potential or a good accuracy factor…
You see what I’m getting at?
So here is the reason why I decided to trade the EURUSD…
breakout, EURUSD, strategy
I’m a firm believer that 90% of your trades depend on your previous analysis and only 10% on your actual entry.
You can have the best entry system in the world, but if you take your trade in the wrong direction, or trade the wrong instrument, then you are doomed!
In fact, I think it doesn’t really matter what entry system you use, as long as you are trading the right instruments.
So here is how I got those 687 pips…
breakout, false breakouts, GBPNZD
As you already know, one of our main jobs as traders is to scan the markets and try to find the instruments that have two things:
Clear S&R levels, this way we know what the market is doing and most important, what it is likely to do, and
Good profit potential, well, this one is self explanatory.
If you keep trading those instruments, you’ll get results.
Of course, sometimes the market will move against you, but it doesn’t matter, because above all, you’ll be focusing in your trading as a whole, a group of trades, not individual trades.
So you only need to make sure to win more when the market goes on your favor… and that’s it!
Forget about the accuracy of the system.
Most profesional traders will tell you that 80% of their profits, come from 20% of their trades.
Do you agree with me?
Here is the signal.
breakout, forex, signal, USDCAD
Not all breakouts are created equal!
Some traders don’t like to trade breakouts, and you know what, I don’t blame them… It’s not a very pleasant experience to see the market just hit your entry order to reverse to hit your SL level…
Heck, there are even some traders that trade the infamous fakeouts (which are false breakouts)…
I guess the trader that invented that strategy didn’t do well with breakouts, did he?
I like to trade breakouts, but not every one of them…
breakout, forex, GBPAUD
Last Tuesday I told you I wasn’t going to trade any breakout in the EURUSD… Here Tuesday’s chart:
I said that I was going to wait for my signal AFTER the breakout because it was trading at The SF Box.
Anyway, the EURUSD broke both sides of the range.
Here is the chart:
breakout, EURUSD Analysis
It’s always very important to perform an analysis BEFORE you start looking for trade opportunities.
Trading without an anlaysis would be like trying to get from place A to place B in an unknown city, without a roadmap… just following our gut feeling.
It doesn’t make sense does it?
Well, the same goes for currency pairs, if you do your analysis, then you can have your trading plan, you know what the market needs to do in order to start looking for trade opportunities…
Anyway… here is my trading plan for the EURUSD
breakout, EURUSD Analysis, pullback
Last Thursday I posted my analysis on the EURUSD, I was waiting either for a breakout or a rejection of the short term resistance level.
If you were watching the market, you already know the EURUSD broke through that resistance level, so long opportunities are still in play.
How do I know this?
Take a look at these charts. First the long term chart:
breakout, EURUSD Analysis, forex
Hey, how is your trading going so far this week?
Have you seen what’s going on in the NZDUSD?
Since the middle of September the NZDUSD trade in a medium term range (not that well defined), and to be honest with you, I haven’t placed a trade in this currency pair since then…
Here is how the range looks like:
But now that the it is out of that range, looks like it might
breakout, forex, NZDUSD Analysis
As we mentioned in an earlier post, the
was getting ready to break either side of the range, and finally today the market broke the short term support level located at GBPUSD 1.6905. Please take a look at the next chart.
This breakout puts shorts in play. Remember however that tomorrow we have the most important announcement of them all, the non-farm payrolls report. It could be a mover because many investors and traders are expecting a recovery.
My Trading plan:
Will look for short trading opportunities. Next long term support level is around
All long opportunities will be ignored.
breakout, GBPUSD Analysis, pound analysis