$ £ € ¥
GreenForexTrading.com
ForeX-tra Gr€€n
Hello Everyone,
In this email I am going to give you my view on STOPS as we are in a very choppy market for US Dollar denominated pairs. Chop is to be expected as the dollar rally is a bear market bounce in an otherwise continuing long-term down trend.
In light of many questions regarding the use of STOPS in trading and the emphasis on placing applying mental stops vs. hard stops, the following missive is posted. Please note that the following can also be said of placing exit prices to take profits and arguably, this is by far the better problem to have.
This brings me to my point of the day. HARD STOPS and EXITS PLACED WITH A BROKER SHOULD NOT BE USED BY THOSE WHO SUBSCRIBE TO THIS NEWSLETTER UNLESS TRADING THROUGH A REPORT THAT COULD AFFECT THE PAIR YOU ARE TRADING. Hard stops (and exits sometimes) with a broker should only be used to trade through a report or some lame official that will be speaking that could affect the currency pair that you are trading or if for whatever reason if you must leave your monitor (to prevent you from blowing up your account), ALL OTHER STOPS/EXITS SHOULD BE MENTAL. With over 1000 subscribers, a number of order entries can be seen by brokers as ripe for hunting, pooling and picking. Remember that order entries can be seen by brokers as ripe for hunting, pooling and picking. If, for whatever reason you cannot watch the trade and must use a hard stop and/or exit with a broker, I recommend adding 5-10 PIPS to the prior defined STOP or in the case of setting exit/target prices, subtracting 5-10 PIPs from the EXIT/TARGET Price. Keep in mind that this might change the risk vs. reward profile of the potential trade that you intend to undertake and you will have to weigh the viability of the trade with these new limits should you chose to use them. This is why it is explained on the website and that key areas of support or resistance be used when placing stops to allow time for the execution of any mental stops and also not to get panicked out of a position on a spike reversal or other faulty trade.
If in doubt, DO NOT TRADE!!! It is OK not to take a trade. This is also why it is explained on the website.
Last month for instance, notice the EUR/USD marginally stopped out on spike reversals on thin volume.
The Nov. 11-12, 2010 trade was written:
“The swing trade for today’s Asian-London-U.S. session is to BUY the EUR/USD in the 1.3605-1.362 area with a STOP @ 1.3585 and a TARGET of 1.3850 for 240 PIPS. Yes, going for the 0.382 retrace of the last 7 day decline move...so loose trailing stops are recommended if you got PIPS!!!”
Well this did require adjustments in the Live ForeX Trading Room to get 100PIPS as this is indicative of hard stops being pooled, hunted and then taken out before the primary trend resumes. Had the trade not been taken out, over 100 PIPS would have been had by all. Most stops in the newsletter trades are far away from defined levels that they really should not even come close to be taken out. In this case, I will admit that it was harder than most. For example, last week’s trade entry at 1.3607 from a defined upper range of 1.3585 to 1.3610…take-out print at 1.3587 in less than 5 seconds on very thin volume. Another takedown occurred some 30 minutes later to 1.3675 and if not for a quick reversal would have put the trading rational at risk (i.e., the rational was to play the bounce off of the 1.3600-1.3604 weekly and monthly pivot level. Remember, commercials (i.e., banks) get money out of thin air and will give it to their proxies as overnight REPO loans and marginal stops are easy pickings. Never said trading was easy.
The trade was choppy with as much as 40 PIP drawdowns was delt by those that used trailing stops. I suspected as much and specified that no trailing stops used in Live ForeX Trading Room, other than to break even, and while the 0.382 Fibonacci Level was not hit we did readjust our target to the 0.234 Level to take over 100PIPS on that trade.
SO:
Trade with Mr. GREEN for $49$ for a 1 week trial. Don’t miss out on more PIPS!!!
For those who join with this special, the service costs only $179$/month after the trial expires, unless you cancel the membership.
Trades are issued in real time, including exact entries, exits and detailed explanations. So go to GreenForexTrading.com now and take advantage of this offer.
Mr. Green
Risk Warning! Trading foreign exchange on margin carries a high level of risk, and may not be suitable for all investors. Past performance is not indicative of future results. The high degree of leverage can work against you as well as for you. Before deciding to invest in foreign exchange you should carefully consider your investment objectives, level of experience, and risk appetite. The possibility exists that you could sustain a loss of some or all of your initial investment and therefore you should not invest money that you cannot afford to lose. You should be aware of all the risks associated with foreign exchange trading, and seek advice from an independent financial advisor if you have any doubts. All information posted on this website is of our opinion and the opinion of our visitors, and may not reflect current situations and occurrences. Please, use your own good judgment and seek advice from a qualified consultant, before believing and accepting and acting upon any information posted here or on this website.
No comments:
Post a Comment