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Thread: Value trader

  1. #1
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    Value trader

    Hi there!

    I will also keep my journal here, and here's my trading plan:


    TRADING PLAN:


    I'm a short-term (1-3 days) momentum trader employing price action and market logics to identify good opportunities.

    I basically divide market states on 2 groups:

    Balanced and imbalanced market.

    Inside of these two groups there are also insitutuinal imbalance and short-term imbalance (weak holders are in control). Know more about my approach to trading here ("Price action basics" posts). Also you can attend webinars, concerning these trading principles


    Trading in balanced market:

    For this type of market I will need to see volatility and rejection in the center of the bracket. To see rejection, I use several clues - directional candles, gaps, pinbars e t.c.
    Rejected level located in the center of the bracket I call "rotational center".
    I use it as a reference point and important trade location. I will trade on volatile breakouts of rotational center heading to the extremes of this bracket


    Trading in imbalanced market:

    In this case, I expect to see participation of big money buyers/sellers.
    For that purpose, I have some clues:

    1. Days with extremely low volatility near extremes
    2. Neutral days after breakouts
    3. Minor development areas protection
    4. One-timeframing moves

    e t.c.


    Mostly I trade momentum, duration of trades are pretty fast (3-4 hours), but sometimes I hold position overnight (from US to Asian session) and in special situations, I trade 2-3 day swings, fading correctional movements. Of course, I should have very strong conviction about big buyer/seller presence in the market


    My objective:

    I want to improve my trade selection and decrease overall quantity of trades, improving their qualty. Historically, I make 30-40 trades a month, the better number is 20-30 with more accurate trade selection

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    Last edited by Value trader; 10-07-2013 at 02:08 PM.

  2. #31
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    Previous week's update. Part 2:

    This week was tough for me - most of the time my momentum trades were stopped out and one potentially good trade (short GBPUSD) was also closed to breakeven, that was really frustrating.

    Later on I've tried to trade-off short scenario on GBPJPY, but it also has not realized and I got stopped twice:

    1. Short GBPJPY:

    It was initial entry, then I moved stop-loss for a while within my risk management parameters (1-3%), then price has broken out to the downside and let me reduce my risk. I've reduced my stop to 12 pips and was stopped out

    shortgbpjpy.png

    - 12

    2. Short GBPJPY:

    Second trade was attempt to trade-off trending pullback scenario, but after all, market conditions were balanced and pair has rallied higher:
    As it was swing trade by its nature, stop was wider than for momentum trades and it was executed

    shortgbpy2.png

    - 32

    After this losing streak I've stopped my trading and gave myself a rest.


    Overall result for the week was -52 and it was pretty elongated losing streak.

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  3. #32
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    Present week:

    Yet, first day of this week gave me good opportunity on GBPUSD:

    1. Long GBPUSD

    gbp.png

    I've closed this trade on 1.6453:

    gbp2.jpg

    +70

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  4. #33
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    dear friend, i still do not get the understanding about 2. Neutral days after breakouts what situation will happen at this position ? and i guess this is for long term ? so can you please explain about it with deeply,
    because as my point of view, if you think there is a neutral day after breakout, the market will move so slow, please correct me

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  5. #34
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    Quote Originally Posted by newentry View Post
    dear friend, i still do not get the understanding about 2. Neutral days after breakouts what situation will happen at this position ? and i guess this is for long term ? so can you please explain about it with deeply,
    because as my point of view, if you think there is a neutral day after breakout, the market will move so slow, please correct me
    Well, it's not that easy but when market (big player) starts accumulating big position, you will see that tempo is slow - for example, if big buyer absorbs all supply from sellers, at some point market can experience lack of liquidity - and it will go in "auction mode" - tempo will be slow, market will more likely balanced between trending moves, and we will see "neutral days"

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  6. #35
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    Previous week update:

    There were 3 long trades on GBPUSD after first winning trade. Actually, two of them were losers, one was winner, but I hadn't fix the profit - I've decided to hold this position and eventually gave back all the profit to the market - this pair was no longer able to keep higher prices.


    1. Long GBPUSD:

    This trade was attempt to buy on possible wholesale price level, market has shown that my hypothesis was wrong, yet I was still confident about destination - market very rarely reverse quickly after strong trending conditions - price at least retests achieved extreme before it goes.

    Robo1.png

    - 20

    2. Long GBPUSD:

    Tried to make momentum trade on reversal:

    Robo2.png

    -5

    3. Long GBPUSD:

    Finally I've captured pullback low from rotational center inside of the trading range, and trade has generated about 70 pips in profit, but I've decided to let the profit run and closed this trade with just 2 pips profit.
    It looks messy, but reality of swing trades (and this trade was a typical swing trade) is that it's not statistically reasonable to adjust stops (you can rather take fix your profits partially) if you decide to hold this trade. So, inspite of such frustrating result, trade management was reasonable (yet, hypothesis was wrong)

    Robo3.png
    Robo3_1.png

    +2

    Finally overall result for this week was equal to +47 pips (+70 - 20 - 5 + 2)

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    Last edited by Value trader; 12-17-2013 at 05:36 PM.

  7. #36
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    This week's trades:

    There were two trades on Monday: both trades were typical momentum trades on rotational center violation.
    Probably, it's one the most fast and profitable trades, when you trade in the direction of strong trade that is still in place, but find trade locations avoiding extremes (instead of it, you cover on extremes), entering inside of the bracket (trading range)

    1. Long EURUSD

    This trade could be a winner, and I was intending to reenter one more time, but I've found better setup on CHFJPY - sometimes crosses provide better reward/risk opportunities

    robo0.png

    -10

    2. Long CHFJPY:

    chfjpy1.png
    chfjpy2.png

    I've decided to exit on 116.30 due to slow momentum - it's dangerous to keep trades near extremes when trend is already mature. I've learned the lesson from GBPUSD trade from previous week

    +47

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  8. #37
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    Quote Originally Posted by taqiniazi View Post
    I don't comprehend about 'rotational middle.' could you please to describe about it more? how we can recognize the spinning middle,I have little dropping ability since the starting of this 7 days (yet, failures are little sized). Industry is not that obvious for me right now.
    I was talking about rotational centers - basically there are levels located within trading ranges, that serve as a center of rotation. Observation is that those levels rarely serve as a point where traders step in the market - everybody is interested in trading around extremes (fading them or going with the breakouts), but not in the center of the range (it's difficult for traders to calculate risk for such trades). Yet, risk is less when you are trading apart from the crowd - rotational center allows you to be a step ahead from the market.

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  9. #38
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    Hello Value trader - Your threads are really of high quality and what you talk is very precise and informative. Of course I have heard about this rotational centers. Many call it as a box and I do the same. As you stated darting from the middle of this range is a technique and is known to all experienced price action traders. Most of the traders around hate the ranges. However when we learn this art, trading range is more fun and enjoyable!. I use this centers very often to make an entry keeping my stops just below/above the other side of the range.

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  10. #39
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    Quote Originally Posted by Pricetrader View Post
    Hello Value trader - Your threads are really of high quality and what you talk is very precise and informative. Of course I have heard about this rotational centers. Many call it as a box and I do the same. As you stated darting from the middle of this range is a technique and is known to all experienced price action traders. Most of the traders around hate the ranges. However when we learn this art, trading range is more fun and enjoyable!. I use this centers very often to make an entry keeping my stops just below/above the other side of the range.
    Thanks for the feedback. There are various ways to place stops, I prefer to work at the edge of the price action and place stops on a distance of sessional volatility - for major currency pairs it is usually no more than 15 pips

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  11. #40
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    Hi everybody! I was away from trading for a while,soon I'll continue posting trades here

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