November 20, 2009

Weekly Trading Update - 16-20 November 2009

After being very ill last week, I'm pleased to say I'm now back to normal again, and thankfully I've returned to the markets and made some decent profits this week. I've traded two positions altogether and both of them worked out reasonably well.

I've already mentioned one of the trades in a recent blog post, and that was the GBP/JPY trade. This was a pure breakout trade. I was waiting for the price to break either upwards or downwards after a long period of consolidation, and it actually broke downwards early yesterday morning.

I used the 4 hour chart for my entry point and went short at 148.95. I then closed half the position at 148.00 and let the other half run, targeting 147.00. However I decided to lock in some profits and moved my stop loss to 148.00, which was subsequently taken out. So frustratingly I missed out on some additional profits when the price did break through 147.00 earlier today.

Another trade I did was on the GBP/USD pair. This was a more typical 4 hour trade, except for the fact that I went against the trend on this occasion. It's not often I do this but I just felt that this pair was due a retracement, and so went short when the EMAs crossed downwards.

I opened a position at 1.6750 on Wednesday evening and let it run overnight with a 40 point stop loss and a 100 point profit target. Neither of these targets were triggered overnight but I was later filled at 1.6650. I really should have let it run but I was being very cautious this week for some reason.

Indeed I was going to go short on the EUR/USD on a few occasions because this pair is also starting to look overbought, but I chickened out because I didn't think there would be a great deal of momentum behind any downward moves.

Not to worry though because I've still made a decent enough profit, and to be honest I'm just grateful I'm back to full health again after last week.

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4 Comments on Weekly Trading Update - 16-20 November 2009 »

November 21, 2009

MACD Trading @ 3:03 am:

Glad you are feeling better! What is your average PIP target? Do you use a set target or just pick predetermined technical levels?

Thanks
Matt

November 22, 2009

mike carieri @ 9:45 am:

Dear James,

Your 4 hour method is an exercise in pure simplicity and presents a very positive way of position trading, as all the 4 hour segments virtually reveal the important cycles in a given market.

However, using the 4 hr chart as a standalone does not permit the fine-tunning which is vitally important for "safer entries". That can only be achieved through using a 5 minute, or even a 1 minute chart.

As a result, severe drawdowns can occur by not fine-tunning entries with shorter term charts. You have not addressed this matter with any credence thus far. Would you perhaps make the credible effort to address it now?
 
Respectfully,
Mike

James Woolley @ 9:59 am:

Matt, I don't have a particular target for each trade although I usually try and close half the position for 50 points on the GBP/USD and EUR/USD pairs, 40points on the USD/JPY and EUR/GBP pairs, and 70+ points on the GBP/JPY pair. I then let the other half run for as long as possible (moving my stop loss to break-even), and close this position based on technical levels of resistance or gut feeling.

Mike, you keep raising this point but to be honest the whole point of using the 4 hour chart is to eliminate much of the noise that you get on the 1 and 5 minute charts. I can't personally see how you can get a decent entry point on a position that could last several hours, or even days, from a 1 or 5 minute chart.

I've been generating profits from this trading method for a few years now so I don't really feel it needs tweaking very much.

November 24, 2009

mark @ 6:28 pm:

Hi James glad your feeling better this week im new to trading and am thinking about just trading 2 pairs the euro/usd and the gbp/usd using the daily charts any advise for me on how to make some money or could i just watch and follow you thanks Mark

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