The Captains Chest - Naked Trading & Other Stuff

[Pueo]

So, I'm hearing that the risk to reward ratio for this trade doesn't put it in the most desirable categories..

[Captain Jack]

CJ, I didn't close my eurnzd short as I was aiming for the adr low and gap close. Do you think the trade is still good? Thanks for sharing your lunch menu.

Consider and then you decide....
CJ

Let's assume a short at the top (the last small "M" up leg), a correct SL should be above the high but by how much ?
As u know this is the favorite broker games to just stop hunt at the highs.

I expect price to climb higher, printing pins the same way it did before. The last pin may breech the highest, center pin in the "M" formation. This presents the breakout to a new high....I would enter SHORT here....and hold my SL till price moved away....

I would use the high of the first set of RRT's, to the left....add 5-10 pips + your spread above the highest pin of the RRT..if they break and hold this level, price goes higher....if price moves lower, away from the pins, set the SL at the top of the last, highest pin... I keep a mental stop when they are "dancing" price around the high..... if I plan to leave, I'll set the hard stop, otherwise I manage the trades without stops when I'm at my computer.

CJ

[Captain Jack]

So, I'm hearing that the risk to reward ratio for this trade doesn't put it in the most desirable categories..

Not sure where your entry was again ..... one thing you can do is to add an order at the top...this gives you a new trade with a very good R:R ratio....if you are in DD now, it brings you out of negative float with both orders, sooner.

If you are going to hold and expect price to return to your entry, why would you not add an entry at the top? you can place an order of larger lot size, with the same risk of smaller sized order that has a larger stop loss.

CJ

[Captain Jack]

Consider this....it's not our job to "predict" price....we follow price, BUT we can take a close look at price and consider the possibilities....

Can I say that I'm 100% sure this will happen? No, but it has the potential to happen. No harm in being prepared in case it does....

You should have a plan for every trade. An entry target, an exit target, stop loss if you use them and to be able to adapt to what happens along the way. There is no EA or utility out there that can think like the box on your shoulders.

CJ

[Reaper]

Most of your trades are on the first leg, which i guess with your experience you dont really need a confirmation second high/low which will just eat up profits. And grabbing it on the first legs means your stops can be smaller. I'm trying to get into the habit of drawing the Ms and Ws of where we think price will go.

Just had a thought, do you think stop runs help shape the Ws and Ms...obviously they do it for the money but it seems to does help in the pattern shaping...or am i seeing things?

[Captain Jack]

Quick little trade targeting 40pips.....

Added a SELL limit above the 40 pip TP....SL is noted....lets see how this plays to the London....

CJ

[Kruspe]

Hi Captain,

what do you think.. could it work like that ?

[Kruspe]

btw Goldman Sachs told EG target is 0.91 (when price was somewhere above 0.875)... it looks like they load buys.. 3 accumulation phases and push it up.

[f451]

and here is me taking NU a swing before CJ

3-14-2013 3-49-03 PM-SK.jpg

[Captain Jack]

Hi Captain,

what do you think.. could it work like that ?

If that's EURGBP then yes, it's the pattern I have it following....the High is a level 3 Peak....we have had steps lower so we should be at Level 3 drop which is peak low, which now becomes the new level 1....

If my "guess" is right, we will trade back up to the previous peak high, retrace a bit then set new highs....

Things look better on the 15M....use the 1H to find where you are in the cycle. Peak high or peak low tend to be level 3 and you could see a lot of choppy, irregular price action here....not the pretty pic you have there....

CJ