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Thread: DanUK Trend Trading Journal 2010

  1. #1
    Welcome to my 2010 trade journal!

    This is simply to maintain a record of those transactions that I have taken, based on this trend trading method: https://www.forexsoutheast.asia/gene...-road-map.html


    * * March 2010 Update * *

    As from March 2010 I shall just be trading daily charts due to the simple fact that I no longer have the opportunity to trade H4 charts. My egy must be ammended somewhat slightly to reflect this change - here's a brief summary:

    Step 1 -- Key Support Resistance Levels

    In my estimation horizontal support and resistance levels will be the key to the market. These are the degrees where the boys are buying and selling and that should interest us, the retail trader.

    The very first step is to spot the nearby key levels of support and resistance that could be of use to us. We are not looking to map each and every level but we want to highlight the vital levels that could be a practical place to enter or a barrier to your transaction.

    These levels aren't necessarily to the pip levels -- they'll often show as a range.

    For an example of what I consider a key level, plot 1.3850 on a EUR/USD chart.

    Step 2 -- Discovering The Trend

    I am only interested in trading support and resistance levels from the direction of the prevailing trend.

    In order to specify the trend we have to first zoom out as much as possible. It needs to be clear which way price is going. When it isn't then it's probably not worth trading!

    In an uptrend, each major swing ought to make a greater high followed by a retracement making a higher low. In a downtrend, each major swing ought to make a lower low followed by a retracement making a lower high.

    By drawing a trendline (or sometimes more than one) across the highs and the lows of the chart we ought to also get some idea about the tendency.

    It is also very important to zoom out to weekly and monthly charts to acquire a better understanding of where we are from the large picture.

    Step 3 -- Putting A Trade

    So we know the tendency and we know where we are going to trade from (i.e. the vital levels) -- we all need to do now is wait for price to retrace to one of the key levels.

    Let's assume we are in a downtrend. On most occasions I shall put a sell limit order in the level. If however I am unsure about the transaction for some purpose (perhaps we've moved a long way out of our trendline and expect a deeper correction) then I shall watch price action in the level. If price blows through the level I shall let it go and wait for price to move up to another level or wait for price to get back beneath the level. Or if price struggles to make it through the level, or forms some kind of candlestick pattern (shooting star, engulfing bars ) I'll look to trade under the level. Vice versa in an uptrend.

    Step 4 -- Trade Management

    This is where my style has changed somewhat and will be the most abstract area of the method.

    Once I put an order, I will not place a default stop loss of”X” amount of pips. Again, let us assume we are in a downtrend. My tough stop is going to be set over the trendline and over a current swing high. It will be put somewhere I don't anticipate it to get struck unless something terrible happens (global disaster!) . This is my emergency stop loss... it is only good practice in the event that I can't get to my trade channel or broker for a few reason.

    When a transaction goes against me I will likely stop the trade before my emergency stop loss gets struck. I'll be watching price and how it reacts to the trendline and support and resistance levels. When it's blowing through them contrary to my perceived trend direction I shall close the transaction.

    When the trade proceeds in profit I shall only allow it to run. Then when we get to another level I'll be looking to bring another place and so forth.

    I shall finally transfer my emergency stop loss but it will be a”worst case scenario”. I'll look to shut my transactions in the event the tendency appears to be changing or if we've moved aggressively away from the trendline along with a profound correction could eat up a lot of profit -- in this instance I shall look to shut my transactions along with the point that maximises profit from open positive places and minimises loss from open negative places.

    My 2009 journal can be found here: https://www.forexsoutheast.asia/cryp...-0-indior.html

    Questions always welcome!

    Regards,

    Dan

  2. #2
    Dan gud to see you opening a ribbon for journal purposes. I have some questions though:

    1. The RR on some transactions are low like 25 pips on 100 pips SL. Might it be as a result of TP being put that way or the TSL was employed?

    2. USD/CAD was a pawn commerce using a 100 point SL. No anti-hedge trade on this?

  3. #3
    Quote Originally Posted by ;
    Dan gud to see you opening a thread for journal purposes. I've got some questions though:

    1. The RR on certain trades are way off. Even as low as 25% return on trade. Is it due to the TP being put that the TSL or way has been used?

    2. USD/CAD was a pawn commerce using a 100 point SL. No exchange on that?
    Hi vicky_ag,

    Perhaps not a very positive first response to this year's journal!

    1. I would not say my Ris way away!!! The lowest yield was really 50% not 25% (please visit the pillar to the right for percentage returns). But, I do not use fixed RI use a trailing stop loss - therefore the market decides what RI reach.

    At least three February trades have attained a Rof 1:3 (300 percent ) - those results will be posted at the end of the month, although they are discussed in my primary thread.

    2. Correct, I did not A-H that trade. Reason being that price action on the afternoon (28th Jan) showed a clear bullish rejection of the downward trendline - a warning sign.

  4. #4
    Quote Originally Posted by ;
    Hello,

    Not a very positive first reaction to this year's journal!

    1. I would not say my R:R is far off!!! The lowest yield was actually 50% not 25 percent (please see the pillar to the right for percentage returns). But, I don't use fixed R:R I use a trailing stop loss - so the market determines what R:R I reach.

    At least three February transactions have achieved a R:R of 1:3 (300%) - these results will be submitted at the close of the month, although they are discussed in my main thread.

    2. Correct, I didn't A-H...
    Dan, Sorry I phrased the sentence to be too unpleasant.

    I wasn't doubting you or your way of investing.

    As, I guessed TSL of 100 pips has been the reason.

    What all pairs you consider?

  5. #5
    Quote Originally Posted by ;
    Dan, Sorry I phrased the sentence to be overly unpleasant.

    I was not doubting you or your way of investing.

    Personally, I guessed TSL of 100 pips has been the reason.

    What all pairs you look at?
    That is okay, I understand you did not mean any harm really!

    The two Chief pairs that I follow would be GBP/USD and EUR/USD but I also follow USD/CHF, USD/JPY, USD/CAD and AUD/USD.

    Regards,

    Dan

  6. #6
    Dan

    Say That the EU is an uptrend on Each Week and daily and a Downward H4. Obvious way is to avoid shorting EU to stick to the main tendency but that cud be a tendency turnaround stage. In other words, things to do when two TF's dont agree upon the direction which could be true in the event of retraces. That could be the situation when even our anti hedge doesnt work, wont it?

  7. #7
    Quote Originally Posted by ;
    Dan
    Quote Originally Posted by ;
    Say the EU is a uptrend on Each Week and daily along with a Downward H4. Obvious way would be to prevent shorting EU to stick to the main trend but that cud be a trend turnaround point. Simply put, what to do if two TF's dont agree on the direction that can be true in case of retraces. That would be the case when even our anti hedge doesnt work, wont it?
    This happens to be a question I get asked very frequently. The answer is simply to trade the trend that's shown on the timeframe that you're trading but trade it with the understanding of what is going on in the big picture; that's making sure you're alert to potential turning points in the longer term trend in addition to the points of interest in the immediate trend.

    A good instance of this would be EUR/USD August 2008 to mid-December 2008. The long-term trend was obviously up but you would have been waiting a very long time to get back with a long position... you would have been earning an investment rather than a commerce (just out of curiosity... draw a fib retracement in the low point of that long-term trend, starting February 2002 at roughly 0.8560 to the high point in August 2008 at roughly 1.6040 - check out at which 50 percent retracement has been ). However, trading the H4 trend (down) would have given lots of chances.

    That's of course, just my opinion on it. Others may feel differently!

    Regards,

    Dan

  8. #8
    Hi Dan,

    great that I could be together with you durring this year.

    I tackle a question right at the start. EUSD is down since USA is stricking straight back and the EU appears to be not as powerful as some thought.
    As EU is a leading pair and durring the recession was in an uptrend, now that the trend got shifted, would you expect AU, NZ, UCAD trends to change too?

    In principle I also prefer to check out the chart and react on what I see. . .that is for certain. This is only for discussion.

    Have a Wonderful weekend.

  9. #9
    Quote Originally Posted by ;
    Hi Dan,

    good that I can be with you durring this season.

    I tackle a question at the start. EUSD is down as USA is stricking straight back along with the EU appears to be not as strong as some thought.
    As EU is a major pair and durring that the recession was in an uptrend, today that the fad got changed, would you expect AU, NZ, UCAD trends to change too?

    In principle I also like to look at the chart and respond on which I see. . .that is for certain. This is only for discussion.

    Have a nice weekend.
    Generally speaking yes, the secret being functionality of the USD. Nonetheless, these are strange times for the economy (internationally and domestically) so transaction what you see is that the rule!

    Regards,

    Dan

  10. #10
    Quote Originally Posted by ;
    This is a question I get asked quite frequently. The solution is simply to trade the trend that is shown on the timeframe that you're trading but trade it with the understanding of what's happening from the big picture; that is making certain you're aware of possible turning points in the longer term trend as well as the points of interest from the immediate trend.

    [color=black][font=Verdana]An illuion of this could be EUR/USD August 2008 to mid-December 2008. The long term trend was obviously up but you...
    Dan, the bounce came from Oct 2008.

    That leads me to another query. How do you specify a trend shift? HH, HL and LL, LH break or something else?

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