Million dollar question

[Cheeter]

Doubt any can answer this question but here it goes.When a news event comes out and the market instantly spikes in one direction or the other, who is placing these orders and how do they know to Buy or Sell before I do? Seems a little sketchy to me. Thanks Cheeter

[dudest]

If you review the thread, you will find where I posted examples of live trades DURING news events. You will also note that I have stated "news" is not news to some people and this is how they unwind positions or establish new positions, QUICKLY. It's how they create the volume of transactions needed to move price the distance they need to book their profit. Remember that PIPS are the unit of measurement for price movement. It takes days or weeks to build their position, but minutes to unwind it and book the profits.

The stop hunts at the beginning are to do just what they did, clear you and others of correct trade positioning or to force you into the wrong position. That's why the 1st move in the "hunt" is usually a false move. Understand there is no reason to establish a position BEFORE a "news" event when you can use the edge of the false trade for placing the position.

CADJPY was a perfect setup, generating thousands of pips with stacked orders....

Look for a rebound long trade here...

CJ

...

Once you realize that every indicator is controlled by price action and that price is not random, but piloted, then you will also realize that those who control price also control every indicator in use today. The indicator action you see is what they want you to see. That's why, indicators will work to a point and then fail just when they seem like they should work the best. Indicators always lag price, which means, you and everybody else place your orders, relying on a lagging indicator that is painted by a brush that they control. Price.

...

I have learned to trade large lot sizes, with small stops, taking what is given and reducing my capital exposure to the market. Most of my trades are self managed. I very seldom rely on hard stops as once they turn price, they very seldom go back because they have locked people into bad trades and will not allow them to exit. As market makers, they must make the market, selling to buyers and buying from sellers. This means when the market is moving higher, they are selling. When the market is moving lower, they are the buyers. They book their profit when they turn price and reverse it back above or below their aggregate price, as a buyer or seller. This behavior results in the cycles and steps. On the 15M time frame, they like to change direction every 3-5 days. They will use "news" events to swing price much farther than they normally could and this is the profit booking. It takes a large amount of money to do what they do but they do have limited funds to work with. It has to be turned over at some point. Have you ever heard of "sell it up" and "buy it down"? It's what they do. The public buys it up and sells it down, and they lock them into those positions when they turn and run. Learn how candles form on the chart you are watching. How is the picture being created that you are watching? Think about it.

...

CJ

Let me make one thing clear. The information and concepts that I have put forth here are not a "system". It is my understanding of the Forex markets and how they work and who controls them. This is an unregulated market. Understand that. There are very few limits in this market, one being how far a market maker can move price, on average, every day. Talking heads, fundamentals, technical conditions, news events or economic news do not move the market. They are excuses for those who do, to push price great distances over short periods of time. News, be it economic, fundamental or otherwise in nature, is known to "somebody" before it is news to the public. Banks know the news before it is news. So to say, when a talking head provides what is already known, to the public, is what causes price to move is ridiculous. The public does not move price. It is nothing more that the trigger that is pulled to launch the bullet. These are known events to those that control price. I won't get into a pissing contest with anybody on this as these are my views. They are set in stone, my trades and my results are based on these. Others are more than welcome to disagree and their trades and results will show, based on their beliefs. If you are profitable, great. If not, perhaps it is time to consider another way of looking at the market.


It seems there are a lot of people who confuse central banks with market makers. They are not the same and the rule of price movement does not apply to them. The currency of the worlds nations are nothing more than promises to pay, they are in truth worthless. After all, what true value does a piece of paper have when you can have your nations printers create them at will, out of ordinary ink and paper? When a central bank intervenes, which they love to do when things get too speculative with hedge funds, price can move 1000's of pips in minutes. They are the ultimate predators in this market and when the sharks, foxes and other predators get to out of hand, it is the banks who devour them.

Understand clearly that the tools these "somebodies", who I refer to as the Fox, use to move price are also limited. They continue to use the same tools over and over again, because they work, over and over again. That is why patterns repeat over and over again. I have seen discussions in other threads about the predictive power of the Fox. The Fox doesn't predict price movements, the Fox creates price movements. HOWEVER, I do believe that price direction and movement can be predicted and I have done this in the past many times, showing direction, chart patterns and at times individual candles or concise shapes that the moves will take. I have done it early in this thread as well as numerous time in the BARF thread that was ported here from FXAW. There was much information deleted, by me, from the BARF thread that was directly related to price prediction. The reason being was that no matter how often I predicted price or a pattern, which came to fruition, people would say, "I saw it with my own eyes, but I don't understand how you did it." In essence, no matter how much time or effort I put forth in showing people how and why price can be predicted, their beliefs and closed minds prevented them from "seeing" what occurred right before their eyes. I have long since dropped those teachings as I have no time for dealing with people who cannot fathom such a change in their beliefs.

People have asked about my absence here. What more can I say? What more can I show you that I have not shown already? I have been offered more money than you will ever know to trade funds, private accounts, PAMM accounts or for offering signals. I have no interest in taking responsibility for other peoples money. I have no need for the money offered as I can trade my own accounts and acquire what I need in this manner. I have no need to provide verified results as I don't sell anything. I have no need to sign up for a service that offers me capital to trade in exchange for partial profits. I don't endeavor to be a rich man. I have what I need and am comfortable in my life. There is a pic provided to one of my sweep accounts. I have 6 trading accounts including equity accounts.

Anybody who trades this market should have goals for their trading. Why are you trading and what is your goal for trading? If you think you are going to open and account with $500 and retire in 6 months, save your $500 and buy a new tv. Most people who trade small accounts, end up making pennies on the hour IF they make a profit, were you to add up all the hours they spend looking for systems and ea's, trying this indicator and that indicator, reading, demo trading and all the other things that most, if not all of us have done. Everyone of you reading this should take a long look at the time you invest and what you receive for those hours. Seriously.

I have also seen a lot of people who's systems have taken a hit lately due to so called market volatility or seasonality. There is so such thing. There is only price and the actions and directions that price takes. So much has been made of the predictions the Fox makes. What do you think indicators do? They are the ultimate "Great White Hope" of price prediction. They can no more predict what price is going to do today, tomorrow or a week from now than your grandmothers can. ALL indicators are based on the movement of price and only react AFTER price has moved. The people that control the movement of price know this and it is price movement that creates the myth of volatility and seasonality. When you understand this, and start to trade price and only price, volatility and seasonality no longer exist.

Price and only price exists, always has and always will. Price patters exist and always will and they will always exist and repeat themselves.

Best wishes and good trading to all.

John

[FXNZ]

Excellent Captain. A man after my own heart.

[Cheeter]

Thank you Captain for a very clear and precise answer. Cheeter

[garyfritz]

Cheeter, you're probably a part-time hobbyist trader running free crappy software (Empty4) on a low-cost laptop/desktop with something like a cable or ADSL connection. Whereas banks &etc have multi-million-dollar custom software written by armies of PhD's running on high-end hardware with high-speed connections to the data source, usually located close to the data source to minimize speed-of-light delays. How can you believe you should be able to compete equally with them?? Would you be surprised if you got smoked if you wandered onto the field in a World Cup game? Would you expect your Honda to compete in a Grand Prix race?

IMHO you can't beat them at their own game. You have to find niches that they aren't dominating.

Regarding the Captain Jack quotes:

I like CJ a lot, but I never "grokked" his method. I've known many traders like him who could call the market with scary accuracy. Over the years I discovered most of them actually have no idea how they do it -- it's all magic in the "wetware" between their ears. They developed this skill over years, and it works for them, but they don't really understand their own process. Many of them THINK they know how they do what they do, and many of those offer to "teach" their systems. I've spent too much money myself on these systems, and in most cases they NEVER work for almost anyone but the original trader. The master trader says "Just follow rules A, B, and C." So you do, and you lose. You confront your mentor and he says "Oh, well you shouldn't have taken that C trade." Why not? "Well that D pattern obviously invalidated the C." So you add D to your bag of tricks, and you keep losing. The boss asks "Why didn't you take that B trade??" Well it didn't match the B rules. "But that E meant the B was a valid pattern." So you add E and you keep losing, rinse and repeat ad nauseam. The master trader has an endless supply of these exceptions and new rules for each new situation, and they pop into his mind as he needs them. But he can't teach that, any more than LeBron James or Michael Jordan could teach you how to play basketball like they did.

I didn't follow CJ's techniques closely enough to know if he fell into that category or not. (Even if he did, he was at least sharing his experience for free on the forum. If it didn't work for you, you weren't out thousands of dollars for his fee, and that made him a lot more honest than most of the "teachers." He donated untold hours of his time to try to help his fellow traders, and I respect him a lot for that.) I followed his BARF patterns for a while, and while they looked great in hindsight, I could never make them work consistently enough in realtime. Same with his "Fox" concepts -- they never made sense to me. I have to wonder if the "Fox" was CJ's version of the A, B, C (and D, E, ...) rules in my example above. He honestly believed they explained the trades they made, but they didn't unless you also had the unknown expertise in his head.

Did anyone (who didn't already trade that way) learn CJ's techniques and successfully trade them? Or was the "Fox" another savant's incomplete understanding of the magic happening behind his eyeballs?

[Cheeter]

Hi garyfritz and thank you for your input.I do use Empty4, but on a good laptop with not the best internet speed as I am in the county side in Ontario Canada. I started trading Forex 5 years ago at slow times while running my furniture store. I had no mentors and not a clue of what I was doing. I learned everything on my own coasting forums and it has cost me tens of thousands of dollars in the first three years. But hey people spend more on courses that don't work for them or going to college for years then end up in a factory. I tried every free auto trading system out there and gave up on them pretty quick. The same with indicators trying to find the perfect combination, although I do use a couple of modified indicators. I only have a grade 8 education but I don't give up on anything. I spent 18 hours a day maybe more studying charts and tweeking system after system. On the weekends I would tell my wife I have it all figured out, but when trading started again after the weekend it was back to the drawing board. A couple of years ago I finaly figured out a system that works. I sold my furniture store and have never looked back. You don't see me on the forums often because I probably can't find any info to improve on what I already have. I just came on to ask that one question that I couldn't wrap my head around. Thank you for the answers by the way.
I don't understand nor do I care about the economic news events except for the fact that I do not trade during a Non Farm Payroll. Tried that and 80% of the time it was disastrous for me. For me the good trade setups usually come after the NFP or any other time of day. You don't need a fast computer or crazy fast internet although it helps, Having a good ECN broker that dosen't take the other side of your trade is important to me. I rented a house in Lake Atitlan Guatemala this year for a month and had to put up with slower than normal internet that would drop the conection every once in a while and still made over 13 grand just trading once in a while because I was drinking most of the time and I don't trade when I am drinking. Captian Jack is correct when he said (I have learned to trade large lot sizes, with small stops, taking what is given and reducing my capital exposure to the market.) That is what I do most of the time, but you have to have the right setups to enter the market. I trade 2 - 5 lots with my system and take 15 to 30 pips, sometimes a hundred depends what my system is telling me. 36 winning trades in a row is my personal best yet. People who trade smaller amounts can do this also but you have to get out at the right time. Don't get greedy and sit in the trade until you loose every bit you just made. Take the money and find another trade. Remember 98% of trades are in pfofit at some point. The last two weeks in Guatemala I set my brother in law (who new nothing about forex) up with a demo Empty4 account and taught him everything that took me years and thousands upon thousands of dollars to learn. Of course I filtered out the tons crap I learned over the years. A couple of weeks after we got home he called me and has over 40 thousand profit in his account just from trading after work. He still hasn't went to live trading because just can't beleive it yet that this can be done for real. Funny thing is he didn't even follow all the rules I taught him. He was trading 5 lots all the time and must have a bit of luck. I am not giving away or trying to selling my system.I think if we all had the same system and were all making money,something would change and the system would fail,they can't have us all making money. I am just hoping this bit of info will help others on their way. Ok well enough I didn't I didn't set out to write a speech, just got caught up in the moment. Dont stop trying, it can be done. Cheeter

[garyfritz]

Congratulations, Cheeter! Sounds like you've broken the code. That's impressive that you were able to teach your brother your methods. (Want to adopt me?? )

You're doing better than I am. I generally trade 5-10 lots going for 15-20 pips, but my systems don't trade often enough to make huge money with them. Yet. My account is growing steadily.

Something to consider: when you trade large size, you're taking on some pretty serious risk. In normal conditions you can exit on a stop or when you don't like the look of the trade setup. But imagine what would have happened if you were long EURCHF on January 15. It dropped about 1600 pips with essentially no fills in between. A stop wouldn't have helped you. If you were long 5 lots, you would have suddenly been looking at about an $80,000 loss. What would that do to you?

For that reason I'm not comfortable trading those large positions, even though my system is out of the market about 97% of the time. I'm looking for systems that go for larger moves so they don't need such large position sizes.

[Cheeter]

You are absolutely correct, that happened while I was away on holidays and thank god I was not in a trade at that time. a short EUR/CHF would have been ok. LOL
When I got home I withdrew a lot of funds from my account Still learning I guess you could say. Scared the hell out of me thinking, What If. I never trade over 5 lots. Hey having an account that is growing steady means you are already there. I wish we could all win but that just doesn't work. I had to loose money in the beginning to keep the winners going. Sort of like a pyramid scheme I guess. Have a Good Week Trading Gary. Cheeter

[RainMaker]

Very interesting thread. This is something that I have wondered for a long time. It looks like the banks dominate us again!

[afeudale]

Just wanted to agree wholeheartedly with garyfritz about why it is difficult, if not impossible for someone to "teach" you their system in it's entirety. There is no substitute for experience, and most successful traders have a good deal of it.

Also, a shout out to fellow Ontarian cheeter