Week 4 Performance Review
Yet another week with low volume where we see Friday prices positioned at the low or high for the week with the advantage going to the USD:
Ranges for the week
EUR/USD: 1.1778-1.1931 (currently 1.1788)
GBP/USD: 1.7129-1.7408 (currently 1.7189)
USD/CHF: 1.3050-1.3197 (currently 1.3182)
USD/JPY: 116.17-118.16 (currently 117.84)
Week 4 was another losing week for me (-15 pips, -$242, 4 winning trades, 6 losing trades)
After 4 weeks of trading, I’m still up 123 pips and $1100. If I were trading full-time, the $1100 wouldn’t be enough to cover a majority of my expenses this month and I’d probably be homeless. That is why I’m holding on to my full-time job for now until I can see consistent returns.
This week my charts got "fatter" as I added more indicators and moving averages.
In week 1 and 2, I was in "Raghee Horner" mode and my charts only had the wave and MACD indicators. Weeks 1 and 2 just so happened to be my most profitable. I wasn’t comfortable with just going through the motions of using only her strategy so in weeks 3 and 4, I’ve been experimenting more with EMA’s (8,21,50,100,200), CCI (Thanks Andrei), candlestick patterns, and other indicators like momentum, stochastics, RSI, and bollinger bands. Weeks 3 and 4 might have been a good week to take a sabbatical to just watch the charts and train my eye to spot patterns as they emerge as Andrei mentioned in one of his helpful comments this week.
In the meantime, I’m reading a lot and trying to learn as much as possible. I followed others advice and picked up a copy of "Trading in the Zone: Master the Market with Confidence, Discipline, and a Winning Attitude." I’ve also been lightly reading, "The Candlestick Course" by Steve Nison and "Day Trading the Currency Market" by Kathy Lien. Lien’s book is much better than I thought and has given me additional insight into the market that I otherwise would have missed.
Happy New Year!
Holiday Reading: The Candlestick Course
I picked up a book today in the bookstore by Steve Nison who supposedly was the first westerner to reveal candlesticks to the West.
It’s called "The Candlestick Course." Brian, a regular website visitor mentioned his daily Illuminations newsletter to me and I signed up for the 2 week trial. You can check it out at http://www.candlecharts.com/
I can’t really say more than this because I haven’t opened it yet. There is a posting on this site with a candlestick glossary attachment if anyone wants to get familiar with candlestick patterns. Just use the search feature and look for "candlestick glossary".
Forex Candlestick Test
I’ll call this a test but I actually consider it more of a learning experience. I’m going to post a snippet of a Daily chart which actually occurred sometime in the past 10 years. You can either post your comments or keep them to yourself. For most of you, this may be simple. Which way does the price go?
Read more to view the candlestick chart.
Candlestick Glossary
Here’s a good one. Download the Candlestick Glossary thanks to Brian. I hope you don’t mind me posting your summary:
"…Steve Nison’s candle glossary. He literally wrote the book on candles and is the reason westerners use candles today. I like to
force myself to give a name to each candle or group of candles as they come up. You will notice with Steve, that the effect of a candle may take place several candles on – he may point to a bearish engulfing candle five or ten candles later and say "see, I told you so".
Also key to his strategy : reversal does not mean up goes to down; reversal mean a change from one state to any other : the 3 states are up, down, sideways. Very important distinction… and lastly, he feels every candle signal must be verified with western technicals; S & R etc. "
Candlestick Glossary (8.94 MB 09.12.2005 10:50)
