Learn:Forex Exclusive Analysis
Learn::Forex provides exclusive content for members of FXCM. I find that out of all Guest Trading Ideas they have "keeping it simple" analysis that you have to respect. Others have analysis that from day to day is not consistent and analysis that also can be contrued as more of an art. (easily interpreted differently from 1 person to another)
Here is Learn::Forex's Analysis today. See for yourself.
AUD/JPY April 12th, 2006
The pairing that has caught our attention this week is the AUD/JPY.
First lets take a look at the Daily. Two things that stand out.First, notice that we have TWO different fib pulls that are coming together and have for resistance. And second, look at the momentum.it is appearing to weaken.
Then on the 240 minute chart we find confirmation of the price action losing momentum and we also get a nice trend line to use. In SHORT there seems to be an opportunity here.anywhere from current market price all the way back to re-test the trend line and resistance zone of 87.00
We have some support at the 85.50 area with more major support coming in at 85.00 which also happens to line up with a .382 retracement fib.
My first trade in weeks
Just like that I'm back in the game. I made my first trade in weeks going short on the USD/JPY. Why did I decide to go short? Quite simply because of the strong resistance directly above my entry. Early in the Asian session today, we saw the pair push as high as 118.69 but it couldn't hold. I'm looking for the pair to come back down to the 116.75-118.00 range perhaps retracing to the .618 fibonacci from the 4/3/06 high of 118.80.
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Are you a Fisherman or a Snow Boarder?
There's a new forex article on Investopedia about trading your own trading style.
Are you as patient as a fisherman or do you thrive the downhill thrills of finishing a snow boarding run? Fisherman are trend traders and Snow Boarders are faders. The point of this nonsense is that you have to trade to your style. If you hate fishing, why trade like a fisherman. The conclusion is:
Whether you are a long-term fundamentalist or a short-term technician, the FX market can accommodate your style. Although the argument between the two camps will probably never be resolved, the one undeniable truth of trading is that you must use the style that best suits your personality. Otherwise, you are unlikely to succeed, regardless of the soundness of your approach. Therefore, the first question an FX trader should ask him or herself is not " Is this pair going to go up or down?", but "What kind of a trader am I?"
Newest Forex Volume Report Released
Open interest dropped across the board this week except in the Australian dollar.
Canadian Dollar 
Big swing from NET LONG to NET SHORT
Swiss Franc
Very Bearish. 50,327 Short positions vs. 3,462 Long positions
British Pound
18,418 Short positions, 13,183 Long positions
Japanese Yen
Decrease of 17,632 short positions. Still Bearish
USD Index 
Decrease of 7,196 long positions. Still bullish with 11,114 Long positions and 4,491 Short positions
Euro
EURO remains Bullish with another decrease this week in Short positions (-10,149)
New Zealand Dollar
Less Bullish than last week with decrease of 688 long positions and increase of 178 short positions
Australian Dollar
Bearish. Increase of 15,455 Short positions on increasing open interest.
Crude Oil 
Less open interest than last week with an almost equal balance of long (128,840) to short (135,177) positions.
FP-1 Trading System
I’ve started trading my new trading system which I’ve simply named FP-1. I’ve been spending a lot of time tweaking it over the last couple of days. I’ve made it quite simple to indicate a buy and a sell opportunity. The red circle indicates a sell and the green circle a buy. If you see a blue circle, this is a losing exit. If you see a yellow circle, this is a winning exit.
; "FP-1 trading system")
I just went went short on the EUR/USD where the last red circle is.
Developing a systematic approach to trading
After days and days of backtesting, I think I have found a simple system that works for me. I backtested it over the last 5-6 months on the EUR/USD 60-minute charts. Of course I understand that there are no guarantees that this system will work well in the future too. But it does feel really good to have designed a system that I can use going forward. My goal over the next month or so is to trade religiously using this system and being the gambler I am do so using my live trading account. It actually feels really great to have a system that is going to generate long, short, cover, and sell signals right on my charts. Here are my backtested results:
; "Forex Trading System")
March 7 Commitment of Traders Report Released
As always, visit http://www.forexproject.com/Forex_Volume to view "Forex Volume"
CAD – No significant changes, VERY BULLISH
CHF – 22,373 less short positions, VERY BEARISH
GBP – Increase of 4,081 short positions, BEARISH
JPY – Increase of 14,161 short positions, BEARISH
EUR – Increase of 3,519 short positions, MIXED to slightly BULLISH
NZD – no significant changes, BULLISH
AUD – increase of 4,899 short positions, MIXED
Stick to your Trading Plan
Here’s a post by Lloyd on his blog at http://tradingforaliving-assess.blogspot.com
American trader and hypnotherapist Robert Krausz argues that 75% of trading depends on your psychology and claims that hypnosis can be used to control your emotional state to maximise your trading performance.
However, he stresses on the importance of having a trading plan at the first place!
Here are the 5 basic tasks necessary to become a winning trader and my personal takes:
1. Develop an analytical methodology
– For myself, I read fundamental news and run technical analysis
2. Extract a trading plan from this methodology
– I set up short-term swing trades (1-3 days), always try to pick good entry and exit prices
3. Formulate rules for this plan including money management
– Take profits while ahead, find the best place to get out on bad trades, not relying on stop loss
4. Back-test the plan over a long period
– Start trading small positions and allow mistakes
5. Finally, stick to the plan
– Having confidence and keep practicing till perfect
CFTC report for February 28th Released
As always, the "Forex Volume" reports can be viewed at http://www.forexproject.com/Forex_Volume/
Summary:
1. CAD increase of 8,221 long positions (Sentiment: Very Bullish)
2. CHF increase of 23,807 short positions (Sentiment: Extremely Bearish)
3. GBP decrease of 11,359 short positions (Sentiment: Bearish)
4. JPY decrease of 33,735 short positions, increase of 14,628 long (Sentiment: Bearish)
5. USD Index had no major changes (Sentiment: Extremely Bullish)
6. EUR increase of 8,785 long positions (Sentiment: Bullish)
7. NZD had no major changes (Sentiment: Bullish)
8. AUD decrease of 3,474 long positions (Sentiment: Neutral)
The Trend is my Friend
My profit so far this week is $883. I have felt very comfortable with the flow of the market and when I look at the charts, everything just seems to make sense. A big reason for this is because of my reluctance to trade a fade or go against the trend. My trades have been with the trend therefore I’ve been trading the faster time frames. It’s amazing how much easier a trade can start in your favor by simply trading with the trend. Even so, my week has not gone without mistakes.
My biggest mistake is exiting positions too early. I had a short position in the USD/JPY open overnight and through the GDP announcement this morning. Shortly thereafter, I closed it out for a slight profit. Afterwards, the pair declined over 40 pips. The trade was going just fine before I decided to micro-manage it. I must try to curb this bad habit.
