Price Action Swing Trading - The PAST Strategy

[myknees]

On GBPJPY right now - I don't care who you are - you don't know what way it is going to go, up or down.

Everyone has an opinion, based on their own views. Or more popular, if they don't have views of their own, they copy someone else's views. The game of the markets is that you express that view beforehand, backed up by whatever reasons you have (which could be literally anything).

Then, when the price breaks out in your direction, you crow loudly about how fantastic your analysis is and how you are a hotshot trader with remarkable market insight and anyone who doesn't listen to you is stupid, because quite obviously you are someone who is serious about markets.

If price breaks out in the direction against your view, you shut up for a while and hope no-one notices. Or blame some other extraneous circumstance for interfering with your top-notch analysis.

What complete rubbish. The movement of the market neither validates or invalidates your prior view. It just went in one of the three directions it can only go - up, down, or sideways.

So, get over yourself and just admit, you don't know. Once you can get down off your high horse and make that admission, you can get on with the important things in trading - controlling your losses and exploiting your gains.

That's my rant over for today!

Love it So true

 

[myknees]

GBPCAD

Got my eye on a break of this trend line on GBPCAD

 

[Nigel Price]

Got my eye on a break of this trend line on GBPCAD

The PAST indicator has picked out a Long Wick a few days ago too…

But as usual, if no trendline break, there can be no trade!

 

[Nigel Price]

AUD/CAD update from this morning. Steadily moving in our direction now.

Stop should now be at b/e.

Risk = 0

Reward = as much as the market gives us.

EDIT: I forgot to write on the second chart - will this particular trade reach 600 pips? Most likely not. It could well get knocked out at break-even today or tomorrow. But there will be occasions when it doesn't. And when you are spending so little on stops, you can afford to wait for a big winner. Even a really sloppy entry wouldn't have needed a stop any bigger than 20 pips this morning. Even a 200 pip target now would be 1:10 risk v reward ratio.

If you averaged around these figures, you could have a 10% strike rate (that's losing 9 out of every 10 trades) and still make fantastic returns.

 

[Nigel Price]

GBP/JPY chart from last night breaking down now...

 

[Nigel Price]

nice clean break - if you are in now might be a good time to b/e your stop. if not, wait to see if we get retest

 

[Nigel Price]

above the trendline would be cause for concern, above 170.50 I would not be in the market at all.

 

[joadri]

Thanks for these updates. Been following along on the trade. Great experience piggy backing your actions.

 

[Nigel Price]

GBP/JPY

Retrace has occurred taking out B/E stop.

Watching now for evidence of bulls stalling out underneath the trendline.

170.50 remains line in the sand.

 

[Nigel Price]

Thanks for these updates. Been following along on the trade. Great experience piggy backing your actions.

No sweat joadri, glad to hear you have found them of some use!

You might not get exactly the same trades/results as me but that's not important - it's the process that is the main thing to reflect upon.

Good luck!

 

[Nigel Price]

In again, 170.34.

After the London close now, so might not much more movement. Be ruthless - if not moving as you want, close out.

 

[Nigel Price]

Chart ->

 

[Nigel Price]

With London closed we are always prone to the low volume upwards drift you tend to get during the US afternoon. S&P just off all time record highs again. I'll be happy to cut this unless we get some traction to the downside.

 

[Nigel Price]

Right, I couldn't be bothered hanging around to watch the vacuum tubes drift! Stop in at 170.50 and I'm going for a run. Happy to pay 16 pips for the opportunity of something bigger.

Another good day here, managed to keep losers under control and have given my winners the opportunity to grow. The market decides when the profit gets paid out - all I can do is turn up and try to do the same thing everyday.

The Liverpool manager Brendan Rogers was saying at the weekend that he tries to make sure that his players concentrate on playing well first - if you play well, the winning results will follow. Concentrate on the process, not the result.

Whether you traded well or not is not defined by the amount of profit or loss, it is defined by how well you controlled risk. The best trading performance of your life could be on a day when you lost money. Equally you could make a lot of money on a day when you traded disastrously.

The market catches up with you in both situations - continue to trade recklessly and you will inevitably lose, continue to trade prudently and you will inevitably win.

All the best, Nigel

 

[joadri]

Thanks for your post. I learned a lot today.

 

[Nigel Price]

Thanks for your post. I learned a lot today.

Thanks for taking the time to let me know joadri, I really appreciate it.

My GBPJPY is stopped out -16 pips.

Take heart anyone who has been trading GBPJPY last week and this week - if you have survived this you will be able to trade anything!

 

[GRS]

Nigel, can you explain how you are entering on retraces to tend lines? limit orders?

 

[Nigel Price]

GBPJPY eventually cracked this morning. When these trendlines break the results are often spectacular. I often say that I look for a "pop" but today was more of an explosion - down 150 pips very quickly

 

[myknees]

GBPCAD Update

One break even trade and now back in again for another bite of the cherry, see chart...

 

[Nigel Price]

Nigel, can you explain how you are entering on retraces to tend lines? limit orders?

Hi GRS thanks for posting the question!

I'm lucky enough to be able to be in front of my screen for a good chunk of the trading day. So I usually just check the trendlines on the pairs that I am watching in the morning and then I just keep an eye on them during the day. If/when price retraces to a trendline, I will just make my market entry as it happens.

I rarely use limit orders, in fact I can't remember the last time I used a limit order! But I suppose if I couldn't be in front of the screen or was trading larger time-frames it would be an option to set them.

I don't necessarily think that one way is any better than the other - if you use limit orders you might not be able to control risk just quite as tightly as you could if you were in front of the screen, or you might miss the odd trade or second bite at the cherry. But equally you wouldn't make any of the stupid mistakes that we are all prone to when trading live, because you would be off doing something else!

Like so much in trading, it is probably best characterised as a simple personal preference based on individual circumstances. Think about what would work best for you, and concentrate on that - that would be my advice. As long as your risk is under control and you give the winners the chance to stretch their legs, you'll be grand.

Hope that helps, any other questions don't be afraid to shout and I will try my best to answer