Raghee’s Second Webinar : Three Step Analysis of Forex Trading

I’m just now getting a chance to post some of the notes from Raghee Horner’s second seminar yesterday titled "Three Step Analysis of Forex Trading."

-If risk is too great, don’t take the trade
-Trade the 30 minute charts for smallest risk 

3 Step Analysis.  Read more! 

1.   Take a clock reading on the wave

-MACD only used for momentum trading!
-If clock reading is between 2 and 4 o’clock, look for momentum trade, otherwise look for swing trade
-Looking for resistance/support using trend lines/fibonacci; waiting for breakout or breakdown

2.    Locate last major move

-Last major move would be most recent rally or decline
-Plot fibonacci (Raghee uses 0, .250, .382, .500, .618, .786, .886, 1.00, 1.272, 1.618, 1.886) She states that her most important are the .250, .786, and .886 retracement levels
-Look for wave support, fibonacci support
-Once break has occurred, look for confirmation with MACD 

3.    Wait for Price 

-Wait for the price to break support or resistance lines, then confirm with the MACD histogram.  If a breakout, MACD must be above 0.  For breakdown, MACD must be below 0.
-Don’t wait for the candle to close and don’t use candle for confirmation!

Additional Notes: 

-Place stop at support/resistance or where trade is no longer valid
-Look at bar of breakout, the low of the bar, the low of the previous bars
-place 3-5 pips above or below support/resistance
-Example was if her breakout was at 1.1730, if her first profit target was 10-12 pips away, she would ignore the first profit target and use the second

VERY IMPORTANT: GET OUT OF THE TRADE WITH THE MOMENTUM, NOT WHEN IT SHIFTS!

-Pivot points are other option if you don’t like fibonacci

-Wait for price to break through support or resistance before entering trade even if you only wait for a 1 pip break 

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