My philosophy of Trading

Post by **MurphyMan** » Fri Sep 12, 2014 9:10 pm

Thanks Bob. I've been out for quite a while, now I hope to stay for a while. Your Philosophy page is as good a place as any to warm up.

:hi:

Sam

Post by **nanningbob** » Sun Sep 14, 2014 12:35 am

Welcome back. I hope these thoughts were helpful.

Post by **astral77** » Mon Sep 15, 2014 2:51 pm

IMHO one of the main factors in the success of your systems has been its ability to neutralize the dirty tricks of the brokers. Thanks to you I have not used stop loss for the last 5 years (except to lock in my profit and to guard against sudden massive movements) and I have never regretted this strategy.

My fear is that by moving towards lower TF trades we are exposing ourselves to the criminals dirty tricks (e.g. SL hunting, platform freezes, massive spreads, etc).

Kind regards

Saint · Post by **Saint** » Mon Sep 29, 2014 5:43 am

Dear Bob,

I am a newbee, and I am still trading in Demo, how do you trade JPY pairs, if one goes up all goes up, will it be wise to trade any one pair, ignoring others and using the leverage in that one particular pair, I am trading using 10.7, I still don't understand the JPY pairs

Thanks

EverEMan · Post by **EverEMan** » Tue Sep 30, 2014 5:39 am

Saint » Mon Sep 29, 2014 12:43 am wrote:Dear Bob,

I am a newbee, and I am still trading in Demo, how do you trade JPY pairs,..., I am trading using 10.7, I still don't understand the JPY pairs

Thanks

I feel your frustration, we've all been there, but you are probably posting in the wrong thread. This thread is concerned with the philosophy of trading which you will develop in time, if you stick with it long enough. Good luck.

Post by **nanningbob** » Tue Sep 30, 2014 6:43 am

Saint » Mon Sep 29, 2014 1:43 pm wrote:Dear Bob,

I am a newbee, and I am still trading in Demo, how do you trade JPY pairs, if one goes up all goes up, will it be wise to trade any one pair, ignoring others and using the leverage in that one particular pair, I am trading using 10.7, I still don't understand the JPY pairs

Thanks

In a sense there is and is not any understanding. If you understand the right long term fundamentals you can always be on the right side of the trade. Understanding JPY would be understanding long term fundamentals of economics with the interference of the Bank of Japan (BOJ), the desire of Asians to use the JPY as security when things get rough, along with traders who buy cheap JPY at low interest rate and then buy NZD and AUD because of its higher interest rate and just collect interest for nothing, to Emperor K and his occasional talking to the press ............................ and on and on it goes. Long term, in other words over a period of years, the YEN is going down. Somewhere, sometime, someday, 240% debt ratio to GDP will catch up to them and there wont be any money for them to borrow anymore. Doesnt look like it will happen this year or the next but i dont know how they will ever get out of that one. Around 50% of Japanese govt. spending every year is financed by debt. According to the history books only one nation has survived going over 150% debt GBP ratio without going bankrupt. For Japan to go bankrupt they would destroy the nations savers since 95% of its borrowed money comes from its own citizens savings account. And that has just about all been borrowed. No one outside of Japan would lend to a country that deep in debt. So the only choice they have is to print money and pay their people back. YEN is going down long term.

I know a guy who had a paid off house in Texas, took a loan out on it and put it on the yen to dive about 2 years ago. So far so good for him, he is sitting pretty. His plan was to hold it 5-10 years and dump it just before YEN finally goes under. He may succeed if he ever finds buyers when he wants to sell. So long term JPY is easy to understand, its going down, short term, well let the games begin.

EverEMan · Post by **EverEMan** » Wed Oct 01, 2014 2:50 pm

A caveat on shorting the yen: The Yen is definitely going down long term as NanningBob said, because the Japanese have neither the resources or the demographics to pay down their debt long term.

But it might be good to remember:

The market can remain irrational longer than you can remain solvent. ~John Maynard Keynes

And all it would take to drive the Yen up is a "risk off" situation, and many events can produce that.

My trading philosophy is very simple:

If I'm nervous about trading anything, my position size is too large. I need to reduce my position until I can sleep comfortably at night.

Lagrange · Post by **Lagrange** » Fri Oct 03, 2014 9:33 pm

Really great info, as always I want to understand everything, study charts, and I am wondering about this quote from the first post:

' Forex is different in that there is no such thing as a currency going up forever or going down forever. What it does is range between two points as business takes place. If you study the monthly charts and go back 20-40 years you can see that price stays with a certain range with a couple of exceptions. For example the eur/usd for the last 15 years has stayed between 1.25 and 1.50 with the exception of a handful of months in 2008. It stays in a range. Knowing this you trade that range. Going up with it until it gets above 1.40-1.50 and go down with until it goes below 1.25-1.30.'

If I go back 15 years on the EURUSD chart the lowest price was somewhere around 0.82 in 2000, the high at 1.60 in 2008. So: EU ranging between 1.25 and 1.50...?

cheers Lagrange

Post by **nanningbob** » Sat Oct 04, 2014 12:37 am

Lagrange » Sat Oct 04, 2014 5:33 am wrote:Really great info, as always I want to understand everything, study charts, and I am wondering about this quote from the first post:

' Forex is different in that there is no such thing as a currency going up forever or going down forever. What it does is range between two points as business takes place. If you study the monthly charts and go back 20-40 years you can see that price stays with a certain range with a couple of exceptions. For example the eur/usd for the last 15 years has stayed between 1.25 and 1.50 with the exception of a handful of months in 2008. It stays in a range. Knowing this you trade that range. Going up with it until it gets above 1.40-1.50 and go down with until it goes below 1.25-1.30.'

If I go back 15 years on the EURUSD chart the lowest price was somewhere around 0.82 in 2000, the high at 1.60 in 2008. So: EU ranging between 1.25 and 1.50...?

cheers Lagrange

This statement will always be basically true with 2 exceptions in history.

1. Nation going bankrupt and the dissolution of its currency.

2. Nation decides to devalue its currency to solve debt problems. There was a time the GBP was in the range of 5-6 to 1 to the dollar but they had a major devaluation after WW2 in the 50's. Maybe a Brit can update us on the history behind that. But that lead to its current range.

Lagrange · Post by **Lagrange** » Sat Oct 04, 2014 3:39 pm

Yes clear Bob,

but:
' For example the eur/usd for the last 15 years has stayed between 1.25 and 1.50 with the exception of a handful of months in 2008.'
Is not on my monthly charts.
as I tried to understand:
If I go back 15 years on the EURUSD chart the lowest price was somewhere around 0.82 in 2000, the high at 1.60 in 2008.

So why saying its ranging the last 15 years between 1.25 and 1.50?

thanks Lagrange