Day Trading the Forex for Profits...

Discussion in 'Journals' started by spinfoiltrading, Sep 3, 2010.

  1. Hey everyone... I'm posting this journal as a sort of "public report" of how someone can successfully trade the spot forex market.

    I am not posting this to explain my methodology, or my "system". I am simply posting to give a public account of how it is very possible to make money in the retail spot forex market... in fact, once you learn how to read price action, observe and interpret "smart money" behavior patterns, and follow good money management... the rest is pretty automatic.

    We'll see how this goes, I'm looking forward to something new. I will be posting 1 - 3 trades on the evenings I trade...which is usually 4 - 5 evenings a week.

    I know this board has a reputation for cynicism... and it's understandable, but I'm going to give this a good effort anyway, and hopefully my trades will speak for themselves.

  2. Looking forward to it
  3. No trading tonight, U.S. and Canada have a bank holiday. I never trade when either of the two largest FX markets (UK and US) have a holiday.

    Why does it matter? Well, if you have a large position, or want a large position, and have enough dough (as all of the largest forex players do have), it is relatively "Cheap" to push price into a level of liquidity - which we call stops.

    Both buy and sell stops work...pros push into buy stops when they want to dump, and into sell stops when they want to buy.

    Why? Well.... if you have a purchase order for $500 million Eur/Usd, you can't just buy now, because by the time your finished you will have pushed the market WAY up above where you started buying from.

    It makes a lot more sense to DUMP $100 million, push the market 20 pips into a bunch of SELL STOPS, if you are the bank and believe the sell stops are worth MORE than $100 million... like, say, approx. $300 million.

    Dump $100, cover at a profit, buy $200 more, and then $100 more at a slightly higher price is ok (because of the original $100 you dumped at and covered at a profit).

    No, you don't have your $500 million yet...but you got $300 of it, and at a BETTER price than the one on the screen when you started moving the market to hit your price.

    So...getting back to holidays... a holiday = Big movers pushing into those $300 million orders for only $30 million.

    In other words, the big boys push anywhere they want, and can afford to do it for they have much less risk when pushing against the trend....

    or with the trend...

    or against, then against...then with...then against... etc.

    I hope u get the picture.

    To be perfectly fair, a holiday would usually have less sell, say it takes $30 million to push into $150 million. Still, the risk reward ratio is better than at dumping $100 to push into $300.
    (1:5 vs 1:3)

    Since my screen doesn't show me the exact levels of liquidity like many big banks and retail FX bucket shops do... I just stay out when this tendency for chop is much higher than normal.

    Don't ask me to elaborate...this is more than I ever got. Again, not here to for my own purposes, and just to confirm an idea that retail day trading the spot forex is possible to be consistently profitable.
  4. AUD/USD in long 0.9130
  5. initial target 0.9157, 2nd target 0.9168
    initial stop at 0.9105, now moved up to 0.9115
  6. closed out half position at 8 pip loss...letting the other half ride
  7. EUR/JPY short 107.27

    1st target 107.02, 1/3 position

    2nd target 106.80, 1/3 position

    3rd target 106.55

    initial stop 107.50
  8. AUD/USD - stopped out.

    initial risk = 1% at approx 25 pips.

    half the position lost approx. 0.16%
    the other half down approx. 0.30%,

    total loss = approx. 0.46%

    short EUR/CAD at 1.3312
  9. EUR/CAD 1st target 1.3296
  10. EUR/JPY stop moved to B/E plus 1 pip.

    EUR/CAD 2nd target 1.3289, stop at 1.3324
    #10     Sep 7, 2010