What Am I Studying?

I have definitely been sidetracked for some time now, preoccupied with only particular GBP/USD forex trading systems.  Due to this fact, I feel like I've disregarded other aspects of technical analysis that may one day turn out to be useful.  This started about 6 months ago after my first full year of trading, where I found myself sitting in front of my computer staring at charts for what felt like forever.  I don't know if it was burn-out or if I just felt like these other forms of technical analysis required discretion, something that I wasn't successful at.  it could also have been that I was looking for instant gratification after months of hard-core learning. 

I'm not sure where my trading will be next year or this year for that matter but I feel the need to start concentrating on some of these neglected areas.  It's strange that I spend so much time optimizing and organizing this website but I don't translate this over to my forex trading and studies.  I feel very disorganized and sometimes behind in what others have learned in an equal or shorter period of time.  I've said this before but I'm going to try to put together a list of things that I want to study and learn more about.  I want to continue with my GBP/USD trading systems but I also want supplement other things into the fray.  Just off the top of my head are:

1. Ichimoku specifically on the USD/JPY.  I'm still reading the new ichimoku book that was sent to me but I've always been interested in this indicator and I want to explore it further
2. Chart patterns
3. Money Management
4. Carry Trades
5. Divergence
6. Fibonacci

These are only a few but I think the key as I said previously is to get organized and try to create a learning schedule so that I can become more adept at forex technical analysis.

Popularity: 8%

Charting From a Different Perspective

I was reading DailyFX's weekly trading lesson today and doing so pushed me to exploring something entirely off the subject.  But first, let me talk a bit about the lesson content.  The lesson was on head and shoulders chart patterns.  I certainly have read enough about chart patterns, head and shoulders being one of them, but I've actually never traded this chart pattern.  The lesson is short and basic and if you don't know much about the pattern, you can read the lesson at http://www.dailyfx.com/story/strategy_pieces/weekly_trading_lesson/Weekly_Trading_Lesson__Head___1173715146697.html.

The example the author gave pertained to the EUR/USD on a 1-hour chart.  The head and shoulders pattern is actually still in play as I write this.  In looking at the picture of his chart, I could clearly see the two shoulders and head.  I then went to my Metatrader charts and opened the 1-hour EUR/USD but I could not see the pattern.  Here's what I saw when I opened my charts:

 

 

 

 

 

 

 

 

I don't see the head and shoulders, do you?  Call me stupid but I never thought about getting a different perspective by changing the zoom level on my charts.  I usually only zoom out at the most one level on my Metatrader charts.  But yet again, I never really thought about zooming out further.  Yes, I feel like quite the amateur but here is what the same chart looks like zoomed out two more levels:

 

 

 

 

 

 

Do you see it now? It isn't perfect but it's pretty evident.  

Popularity: 2%

Ichimoku Charts Book

Harriman House, publishers of finance, business, economic, and political books were nice enought to send me a free copy of "Ichimoku Charts: An Introduction to Ichimoku Kinko Clouds" which I received last week.  The author is Nicole Elliott, a trader for Mizuho Corporate Bank.  I had seen Nicole's name before when I regularly visited the Mizuho bank technical analysis research website.  You can find the links for this and other recommended sites at http://list.forexproject.com.  I found this site very unique in that it was the only technical analysis site where I've seen the exclusive use of ichimoku.  So I started reading the book last week and my first impressions are that it's refreshingly unique material, challenging, yet rough around the edges.  The author is a trader and not unlike me, probably not a trained writer.  In addition, I think she may be European so I cannot relate to some of the non-trading terms she utilizes.   Like I said before, a lot of the information contained in the book is totally new to me so I have yet to grasp a lot of it.  Overall, I'm intrigued and looking forward to reading it further.  When I have time to allow the information to marinate in my head, I'll be sure to pass it along.  Let me leave you with the main elements explained within the book:

1. candlesticks
2. 9 and 26 day moving averages
3. the Cloud and its size
4. Chikou Span
5. long term wave count
6. short term wave count
7. the Wave principle
8. price targets
9. time principle 

I can't fully review the book until I'm finished so I'm hesitant to recommend it but if you are really interested in learning more about the elements above now, you can always buy the book at  http://www.harriman-house.com/pages/book.htm?BookCode=22962

Popularity: 3%

Ichimoku Cloud Filters

I have had interest at times in the Ichimoku indicator mostly for longer term trades.  The information on the internet or in books related to this indicator such as how to interpret or trade using it are very thin at best.  So when I find new articles related to the Ichimoku, I think they are worth posting.  There is a new article titled, "Ichimoku Cloud Filters Information Storm" on Investopedia that gives a good overview of how to interpret the components of the indicator and also an example of how to trade using it.  The author, Richard Lee compares the use of the Ichimoku to the use of your run-of-the-mill support and resistance lines.  

http://investopedia.com/articles/forex/06/ichimoku.asp  

Mizuho Corporate Bank provides daily technical analysis for most currency pairs for free and their analysts use the ichimoku in most of their charts.  This may be a good place to see how they use the ichimoku each day if you want to learn.  http://www.mizuho-cb.co.uk/TresInternet/TECHNICALS/Index.htm  

Popularity: 5%

Stuck in my GBP/USD position

I’m sticking to my long position on the GBP/USD which was initiated
yesterday at 1.7801. Money management is always stressed as the most
important aspect of currency trading and unfortunately I have failed. I
had been disciplined over the last 2 weeks and have exited my position
if losses extend past 30 pips. Right now the Sterling is plunging and
stands at 1.7656. I’M DOWN 148 PIPS in all since yesterday evening.

My ultimate plan is to trade mini’s until I can learn enough to have
the confidence to open a regular forex account. I’m saying this now
because I’m down $148 (mini account) instead of $1480 (regular
account). It shows how volatile this market can be. It certainly is
exciting though.

My hopes for the Sterling today lie in the U.S. Unemployment
report that will be announced in 5 minutes. I know it is going to be up
big time because of Katrina but I’m hoping the market reacts to this
and beats the dollar down. You can view the unemployment report on the Department of Labor website.

-W

Popularity: 1%