Traveling with Family

Hi All, well I've come to Washington DC to pick up my son and cart he and his stuff back to Colorado.  So for this two week period I'm not trading or writing, well much.  I'm using this time to work on my next book. Finally removing all the other trading books from storage for my library to research what others have said, never realised just how many books I have collected.  Trading books back to the 1800's which are very cool to go through.  So, remember to use good money management as trading is risky.  With the right attitude, the right plan, consistent execution, you can achieve any goal you may have, including successful trading.  Remember to hug the ones you love, they can vanish in an instant.

May 20 2011 Trading Room Position Calls

The Following are the FOREX Trading Position Calls for Members of the Blue Heron Trading Room for May 20 2011 0200 to 0800 Hrs Mountain Time, Monument, Colorado. See the Trading Disclosures on the website, the following are the trades as called:
Long: EURUSD 1.43446 close 1.43226 = (22 pips) Loss
Short: EURUSD 1.43301 close 1.43231 = 7 pips scalp
Short: EURUSD 1.42990 close 1.42357 = 63.3 pips
Short: EURUSD 1.42790 close 1.42200 = 59 pips as a second stacked position
Short: GBPUSD 1.62280 close 1.62276 = 0.4 pips
Short: EURUSD 1.42532 close 1.41636 = 89.6

Total Pips for this Trading Session: 197.3

FOREX Trading is not JUST about Making Money?

OK, so here you go again you're thinking... if Trading the FOREX Market is not about making money, why in the world would a person, mmm... me; get up at one thirty in the morning to sit in a dark room, looking at 4 screens, drinking coffee and contemplating the financial goings on in some far away land?

Well, so I'll admit it flat out, I love making money, sometimes big money and yep, I've also made some poor decisions which have cost me but I learn from my mistakes, especially ones that are pointed out to me by my family and friends.  FOREX Trading IS about Making Money!  That's why I sit in this seat hours at a time.  However, sometimes I reflect on other accomplishments not just upon being able to transfer money into our debit accounts and take ski vacations in Aspen and Vail Colorado (nice getaway place is http://www.cordilleralodge.com/ for your family).

Sometimes though, it's about trusting my experience and implementing a great trade and catching a trend.  The simple fact that I had made a great trade puts added pressure on me to maintain a steady composure and not let my head abandon pride and integrity because I'm winning. 

With that in mind, I should mention that your trading plan, like mine, should include principles that can help you implement FOREX Trading Strategies that follow sound behavioral patterns that focus upon commitment, concentration, recovery from loss and future planning.  These are hard things to do because as part of the process; you have to be willing to admit uncertainty, let go of your ego, identify fear, and come to the understanding that you have a lack of knowledge and more.

So, first things first, review your trades everyday, then compare what you are doing with your actual FOREX Trading Plan; in the end, use what you learn to adapt to a more balanced trading process.

Remember to use good money management.  Happy Trading.

Realign and Refocus your goals

As a professional trader of international currencies utilizing the FOREX market place, I find it very important to refocus my attention and my efforts to insure that I'm staying on the right path.  Of course, it helps to have a partner who is also a trader and Diana very often is the catalyst for such a refocused approach.

Diana asks some very hard questions, challenging me to define clearly what I'm doing and why.  Her participation in the Blue Heron Trading Room brings some confusing issues into focus for all of us and her insights via her experience in Fundamental Analysis is very helpful.  Technical traders and Fundamentalists have similar goals, to make money in the markets we trade, but we take quite different paths.

Her recent challenge to me was to help me figure out why I was exiting some of my trades early on.  To do that, she certainly asked me the harder questions that I feared to even ask myself.  Perhaps some of the readers have been challenged in such a way.  I discovered that while everyone has figured out that trading in a trend is easy, the choppy markets of late have increased the stress levels on traders and as such we begin to question our decision tree and trade identification process.

So, challenged as I was, we sat down and started to review and perform a forensic analysis on our Trading Plan (if you don't have one written down you should).  We discovered that our indicators that I use on the technical side fail in the shorter time frames in a risk market environment and something that is a bit clearer was needed.  Technical analysis is my passion so set off on the right direction once again, I explored new indicators, tested them and found that in reality, the old familiar process still worked and all I needed to do was to re-optimize my old charts.

It's important I believe to become familiar not only with your indicators but with the markets you trade.  While we in the Blue Heron Trading Room look towards and trade some seven or eight FOREX currency pairs, I strongly suggest that for new traders they trade only one currency, usually the EURUSD and learn how that pair operates and the indicators work within the FOREX Market action.  Many traders believe that to make more money they have to trade more FOREX pairs, when in reality, the only way to make more money is through consistency.

Your best road to trading FOREX consistently is through detailed exposure to your preferred FOREX currency pair, learning how it moves, the FOREX Market interaction with your chosen indicators, and beginning with small trades, building confidence with growing consistency.  Once your confidence has developed, so will your account as you take more trades with consistent wins and with such a record, you'll increase your trade size.

A case in point... two years ago, I was approached by Chris A who asked me to mentor him in an effort to improve his trading.  He had been grinding down his FOREX Account trade after trade and needed to refocus his efforts and build consistency in an effort to work full time from his home.  That was his goal.  We built his trading plan, focused on the EURUSD only, learned to trade the 5 and 15 minute charts and his consistency began to improve and his account stabilized.  A month later, we touched base and he had remained on track and his FOREX Account was growing.  Later that year he told me that his air conditioner had failed.  With that, he sat down one afternoon and traded during a period he usually didn't trade but his short term goal was to pay for his new air conditioner without impacting his normal trading.  His knowledge of the FOREX EURUSD Pair permitted him to gain the funds needed to pay for the repairs and then some he said in about 3 hours.

I talked with Chris last week and he continues to grow his account as well as take away from the market a very good living.  Sometimes, refocusing is what's needed for all of us to regain consistency and find once again success.

So, if you're having less success than you expect, perhaps a refocus through the help of someone you trust who will ask the very hard questions of you, then direct you to release your unproductive and maladaptive practices and regain confidence.  For me, Diana helps me keep my head on straight in this high risk FOREX Market; perhaps if you don't yet have a Diana in your life, a couple of hours with Diana through our mentoring program can help set you back on track. 

For traders like my friend Chris and several others, FOREX Coaching or utilizing a FOREX Mentor is more about an investment in yourself than it is an expense.  After all, if you improve your trading consistency, are able to increase your trading size and account successfully, the investment in yourself pays for itself time after time after time.

Of course, we're trading in the Blue Heron Trading Room today and I started the day with a rookie move, losing 22 pips.  Stepping back with a fresh cup of coffee and then Realigned and Refocused myself back to success, gaining far more than I lost on that first trade.

Wishing you the very best, remember to hug the ones you love, I do.  Trading FOREX is risky, be sure to use sound money management.  See our disclosures on the website.  Happy trading.  Richard

May 19 2011 Trading Room Position Calls

The Following are the FOREX Trading Position Calls for Members of the Blue Heron Trading Room for May 19 2011 0200 to 0800 Hrs Mountain Time, Monument, Colorado.  See the Trading Disclosures on the website, the following are the trades as called:

Short: EURUSD @ 1.42948 close @ 1.42478 = 47 Pips Email Alert 2240 HRS May 18 2011
Long: GBPUSD @ 1.61356 close @ 1.61760 = 40.4 Pips
Long: EURUSD @ 1.42234 close @ 1.42509 = 27.5 Pips
Long: GBPUSD @ 1.61560 close @ 1.61563 = 0.3 Pips
Long: GBPUSD @ 1.61510 close @ 1.61804 = 29.4 Pips
Long: EURUSD @ 1.42606 close @ 1.42757 = 15.1 Pips
Long: GBPUSD @ 1.62000 close @ 1.61907 = (9.3) Pips (Loss)
Short: EURUSD @ 1.42792 close @ 1.42483 = 30.9 Pips
Long: EURUSD @ 1.42456 close @ 1.42573 = 11.7 Pips
Long: EURUSD @ 1.42272 close @ 1.42741 = 47.9 Pips

Total Pips for the Day Gains - Losses = 240.9 Pips

Email Richard at BlueHeronTrading@gmail.com to obtain information on how you can participate in the Blue Heron Trading Room and benefit from our experience Trading the FOREX Market.

Personal

On just a personal note; we had a lot of snow on Thursday last and then finished up the week with our Seminar on Pivot Point Trading and the trading of the EURUSD and GBPUSD which we exited both with profits. So, as a bit of reward, off to Denver for a weekend of relaxation, a visit with the spa and some great food and of course the multiple visits to Park Meadows Mall in South Denver for some shopping (well mostly I watched and waited of course). 

It's important to remember that trading is stressful and you should ensure you put time aside for you and your family for some fun and relaxation.  That let's you return to your business of trading international currencies with new energy.

Remember trading is risky, always use good money management and optimize your indicators to the markets you are trading.  Good trading.  Richard

The Ulimate Trading Indicator

Not long ago, I was confronted by a client that demanded to know; what was the best real time indicator of the market as he was going to rely on that indicator totally.

He insisted that it had to be real time, not lagging and it had to give precise information as to the market position. 

Well, my response was the elucidation of the ultimate indicator for every market traded.  I explained that it was the only indicator that provided the resolution of the frenzied challenge between bulls and bears in real time with precise accuracy.

This indicator tells you exactly where the battle lines are drawn at any one instant and you can rely upon this indicator to always be correct with no ambiguity.

Predictions of future market moves utilizing this indicator alone are less reliable than suggestions surmised from a diverse set of optimized indicators used by experienced traders to interpolate the future sentiment of any market including FOREX.

However, he was insistent, he knew better than I as his trading plan called for just such an indicator.

When explained however, he was less enthusiastic, you see, the ultimate indicator he was looking for was market price.

The current price in the market is the ultimate indicator as it is the instantaneous agreement between the bulls and the bears and is never wrong. 

Future price may suggest that at the time, the bulls may be wrong, or perhaps the bears were wrong about the future, but at that moment, price as the ultimate indicator is never wrong and neither were the traders involved.  

The market moves based on this negotiation between the bulls and the bears; the buyers and sellers utilizing their personal interpretation of the chaos surrounding market pricing and acting upon that interpretation as they work out the details of supply and demand.

It’s the agreement between them at that instant and in the next moment, another agreement will be made moving the market forward, never back and never lagging.

Predicting moves from a price position alone is virtually impossible; you must rely upon other optimized indicators, fundamental or technical, to give you the ability to establish a reliable analysis about future price and market trends.

Dr. Bill Williams has developed a trading strategy that utilizes price within the candle to include how it’s moving between individual moments within the market.  To be able to trade this strategy, in stocks, futures or FOREX, you have to rely upon careful observation.  Details of the strategy will be discussed at another time.

Like everything else that has to do with trading strategies, one specific indicator does not make a strategy.  Even so, while price is the ultimate market indicator at any given moment, you still must rely upon your knowledge and experience in the market you are trading to properly position yourself for potential gain.

Learn to read and interpret the vast amount of information constantly provided to you as the bulls and bears fight for dominance and move their instantaneous agreements back and forth in chaotic progression.

Good luck trading your selected market, but be sure to use good money management as all trading is risky.

FDIC Getting Involved in the Regulation of FOREX Retail Traders

At the writing of this entry, the US FDIC, the US Banking Regulators, is scheduled to vote on a proposal that would control the way banks and FOREX Retail Customers conduct the business of trading in the FX Marketplace.  The Banking Regulators (i.e. the FDIC staff) want the FOREX Retail Customers to put up 2% of the margin required to trade the major currencies, i.e. EURUSD, GBPUSD etc... and then, post 5% of the margin required to trade some of the more exotic currencies like the SGDHKD (Singapore Dollar vs the Hong Kong Dollar).  It seems that the proposals greatest impact is upon those FOREX Retail Traders that trade through banks and brokers that are not cleared through a major clearing house.

For more information on the FDIC Initiatives under the Dodd-Frank Wall Street Reform and Consumer Protection Act visit http://www.fdic.gov/regulations/reform/initiatives.html the official website of the regulatory agency, the FDIC.

Take time to learn the FOREX Market and Become Great

After these many years of trading stocks, futures and now FOREX, I feel qualified to discuss the mistakes that new FOREX Traders make as I have experienced these mistakes as Dave Ramsey ( www.DaveRamsey.com ) says “with zero’s on the end”.

FOREX Traders can and will do many things under pressure and in many cases are blinded by the information and signals that their FOREX Technical Indicators, FX Charts and FX Currency Fundamental Analysis has set before them. 

Following my failed trades on many markets including FOREX, Stocks and Futures, I’ve looked back and noted my many digressions from my Trading Plan.  Trades that had I seen clearly the information presented to me by my Technical Indicators tell the tale of trades that I would not have taken the trade or at the least would have traded in the other direction.

Haste is the folly of the ill prepared and pressure to succeed in trading is the pathway to failure.  I said that to myself many times, I’ll repeat the same to you now, do I listen?  Now I do but in the past I just didn’t hear myself.  Even now, I go off on a tangent and try to predict the future trends, jumping ahead of my FOREX Technical Indicators.  Yesterday was no different; it was my “Get my head back on straight day” as I tried to jump the gun and traded on the EURUSD and Cable pairs prior to trade confirmation.  The results were not as predicted, stopped out on both for a loss.

Oh, just a bit of history in case you didn’t know, “Cable” is the name for the GBPUSD pair, the British Pound vs the US Dollar.  It was called the “Cable” because it was traded early on from NY and London via the sub-sea Atlantic Cable, hence the name.

So if there is wisdom to be gained by our failures, it is as I profess to you now (based on experience with losses with several zero’s on them); take time with the FOREX Market, or any Market that is in front of you, learn her habits and cycles; success will come when you are in rhythm with the moves she makes.

Learn by reading, explore new ideas through inquiry, and understand the nuances of market fortunetellers and beware their traps for you are the decision maker for your future and these are the true keys to your success.  Of course, no FOREX Market education is complete without the time you spend in front of your computer screen trading the FX.  Start with trading the FOREX on a Demo Account available from several brokers, then progress to a Mini or Standard account and trade “Real Money” but do it from the very smallest trade setting you can take.

Yea I know, bla bla bla; you’re not making any money for the time you spend in front of that screen.  On a FOREX Standard Account, one point is ten (10) cents US. That’s a thousand points for a measly one hundred bucks!  You’ll all of a sudden find out how much work it is to make that Benjamin but you’ll be glad you spent the time.  Right now, 93% of all traders lose their initial investment and refund their accounts 3 times on average before they figure it out.  Want to be that statistic?  Trade bigger lots in the FOREX Market without a Written Trading Plan you understand and follow, and without the experience trading “Real Money” in the FOREX market.  If you’re like me, I hate losing and you’ll find that trading 0.1 lots in the FOREX market is like trading big money after a bit, losing 20 or 40 bucks will sting, maybe not in the pocket book but in your “Traders Psyche”.  Trading the small lots lets you learn how to handle the Psychological Stresses of Trading without the financial burden. 

Now not everyone will follow my suggestions here and not everyone will lose their account.  So tell me, are you willing to chance that?  It can happen fast, like going to Las Vegas on a “salesman’s fling”, you’re going to stress your account before you have a real feel for the FOREX Market. 

To trade the FOREX Market or FX as some call it; you must have the knowledge, courage and stamina to proceed with confidence into the FX Marketplace.  But you don’t have to do that fast; Jessie Livermore suggested “being a moment late was better than being very wrong” and that’s the plane truth of it all.

So for the trader, courage comes with the knowledge and experience of paying attention and trading; stamina with your tenured ability to wait for the right moment, and additionally, confidence is your understanding that for every missed trade there is another soon to be at hand.  Missing a signal is never the problem the newly initiated make it out to be. 

Bob Dylan once said, “Don’t put your hope in ungodly men, or be a slave to what somebody else believes.  If you need somebody you can trust, trust yourself.”  These are words of wisdom for all of us to remember.  He however never meant to imply that you have to learn all of this on your own through trial and error.

Trading is a skill that just about anyone can learn.  You can take years of bump and thump trading like I did at first or you can spend a little time with a mentor like myself and many others out there to propel you forward in your learning experience.  Can you learn Brain Surgery on your own?  Some will say sure, it’s a skill, takes knowledge and experience.  That may be true but I’m not sure I’d want the doc looking inside my head if he just read it once in a book and practiced on frogs.  I’d want the guy who had someone experienced in the business of looking inside someone’s head to look into mine.  FOREX Trading and actually trading any Market, stocks, Futures, Bonds, Derivatives, Options, they all take a bit of training and a strong measure of experience to get good at trading them.

To get GREAT, it takes experience, stamina, knowledge and sometimes a bit of help from a friend.

Here’s to BECOMING a GREAT FOREX TRADER!

Happy Trading from your friends and mentors at www.BlueHeronWealthManagement.com

Thanks for taking the time to read our words, which we hope contain some wisdom that many can share and benefit from.  Have a wonderful week.

Beating FOREX Probabilities and Statistics

Statistically speaking, every FOREX trader out there is up against some significant odds. 

The probability is that you will be giving away more of your money than you acquire through trading the FOREX Market if you don’t develop an edge over the average FX market trader.

Unless you develop that edge, you’re going to end up just another FOREX statistic, so where do you find that FX traders edge and take control of your trading position in the FX market?

The average FOREX trader is a technical trader, using charts to make decisions regarding entry and exit; some don’t even use stops, trailing or otherwise. 

The first step is to know the FOREX market you are trading, that means a top down analysis of the FX Market before your first trade and utilizing technical indicators that are optimized for the particular FX market you are trading that day.

The next step is to know the technical indicators that you are trading in a volatile FOREX Market, some will provide many false signals while others are lagging the FX market far enough that in most moves, you are too far behind the Optimized FX Market to experience any significant gain. 

Our goal at Blue Heron Wealth Management, Inc. is to help you identify a series of technical indicators that provide consistent entry and exit signals in the FOREX Market well ahead of the average FX trader.

A favorite FOREX Technical Indicator of mine is an FX market optimized stochastic.  The developer of the indicator stated that for years he made more money with the stochastic than his wife could spend.  That I think is every husband’s goal, but that’s another story.  Be sure to check back as we are planning an online seminar called FAST TRACK STOCHASTICS in association with www.FOREXTurtle.com and a second upcoming online seminar regarding a custom indicator that we use and you can easily obtain.

Check out www.BlueHeronWealthManagement.com for more information.

Don't Forget to Do Your FOREX Market Top Down Analysis

The coffee is fresh and hot and you’re settled into your favorite office chair with the computers humming and your preferred news station talking away behind you. 

What you do next could mean the difference between an average day trading the FOREX Market and an exceptional day… if you start your FOREX trading day like a pro…

If you normally trade the five or fifteen minute charts and never venture above the thirty minute, you’re missing something big.  Most professional FOREX traders, including the author to this blog, start their day doing at least three things when they hit the seat:

First, they do a top down analysis of the FOREX Market they intend to trade, that is, they look at the weekly, daily, four hour, hour, half hour charts and note the position of their favorite optimized FOREX Technical Indicators…

Second, they review the calendar for any scheduled news reports that could have an impact on the FOREX Market they will trade (I use http://www.forexfactory.com/ as one of the first I check), so that I’m always aware of the time prior to a big news report which can/will stall or rocket the FOREX Market; and that’s good to know;

Third, they look at the overnight news to see if anything is impacting the FOREX Markets at this time, such as terrorism, bank failures, and government unrest, which can all shock global FOREX currency relationships. (Think the ongoing Greek Banking and government debt problems.)

Once your top down analysis is complete, begin to identify your daily pivot points and identify your historical support and resistance for the day.  Some professional FOREX traders also take the last major move and display the Fibonacci Grid or use a Fibonacci Spiral on the FOREX Daily Technical Charts to see long term Support and Resistance before they start their FOREX Trading Day.

During the day, always be sure to check the higher time periods in the FOREX Market you are trading for support and resistance points that are building as well as the position of your favorite indicators for similar positions in all time periods.  This knowledge could foretell a major directional change in the FOREX Currency Pair you are trading and a position where you would not wish to try to fight against.  Consider that a very strong FOREX entry or exit signal is when your FOREX Technical Signals are showing a change in the FOREX Market on more than one time period above the period you are trading. 

Keep an eye out and capture more jingle for your pocket.

FOREX Trading Goals and Adapting Napoleon Hill's Think And Grow Rich

Ask almost any successful FOREX trader the secret to their success and they will tell you, consistency in the way they trade the FOREX Market is the key.

You can’t become consistent if you don’t know the rules under which you take a trade or even exit a trade. 

So how do you develop consistency in trading the FX?  Well you begin with writing down your goals and the steps you take to attain them. 

Napoleon Hill in his bestselling book “Think and Grow Rich” puts it quite simply…

1. Fix in your mind how much money you want to attain, be specific;

2. Determine what you are willing to give to reach your goal, you can’t get something for nothing;

3. Identify a specific date at which time you will attain your goal;

4. Develop a plan on how you will attain your goal;

5. Write a clear and concise statement of your goal and how you will attain it, keep this statement to one or two sentences;

6. Read your statement out loud every morning after waking, and every evening before you retire to bed.

In other words, build and use a specific FOREX Trading Plan that clearly identifies your goals, the steps you will take to achieve them, and review that Trading Plan at least every day before you begin trading the FOREX Market, at least until it becomes… your… routine.

It doesn’t have to be elaborate; it just has to be yours!

Having a FOREX Trading Coach and an FX Trading Plan works!

“Don't take action with a trade until the market itself confirms your opinion. Being a little late in a trade is insurance that your opinion is correct.” In other words, don't be an impatient trader... Jessie Livermore said those words more than 60 years ago.

William Gallacher in his book winner take all says, “that a trader must learn to live with the unexpected, and learn to make difficult decisions under conditions of great uncertainty, and possibly, if he’s not careful, under conditions of great pressure.”

Perhaps for you, the lure of trading the FOREX Market is the bottomless pit you feel you’re about to step into, or the presentation of the uncertainty that the FX Market brings with each bit of news, each rapid change of direction, each spike and reversal;

If you look to your FOREX weekly then daily charts, you’ll see a steady flow as the market rises and falls like a breathing giant.

Look closer at this sometimes forbidding FOREX Marketplace and you see crazy moves, sometimes unimaginable jumps in price called gaps, and extensive chaos surrounding almost every peak and valley in your chart, you’ll end up wondering how can I learn to benefit from these crazy moves?

You will find that as you go deeper into the FX bottomless pit (that is smaller time frames), the chaos grows and volatility can sometimes rule the roost.

Managing this uncertainty is in part gained through the experience you get by sitting in front of your charts, watching the sometimes manic and crazy FX Market and trading this lumbering giant on a demo account.  Many people find it useful to engage a FOREX Mentor or Personal FX coach to help learn to profit from the FX Market.  While these outside options cost a bit, in reality it can save you years of learning and thousands of dollars learning to profit from your FX business.

In 2009 I met Chris A from northern Virginia at a Traders Meet-up in Rockville, MD.  At the time, Chris had invested $20 thousand dollars in his FX trading account. 

As traders, we can’t always be right, so in order to keep that uncertainty in control, we employ a few rules to our trading plan.  Having the right rules for the right market conditions is the key and Chris had a difficult time staying on the winning side of the trade.

He chose to engage us as a FOREX Trading Mentor and his FX Coach, immediately, we employed several objectives including a written trading plan, optimization of his technical indicators, instructions for future optimization of his FX Technical Indicators, review of several alternative FX Technical indicators and review of a couple of different trading plans that have worked for other people.  With this information, we helped him developed his own Trading Plan that worked well for him.

For instance, he elected to use a special stop process, optimize his FX technical indicators for a shorter time frame, and take trades on moves where the risk of reward, that’s the jingle in your pocket, is greater than the risk of loss, which is the jingle in someone else’s based on this optimization; and found a process for FX Trading Success which continues to this day as he trades during a time frame he enjoys while leaving time for family and fun.  In a recent conversation with him, he indicated that when his “…air conditioner went on the blink, he went up to his trading room and in less than 3 hours he had made enough money to cover the replacement without impacting his monthly earnings…”

That’s the kind of success we at Blue Heron Wealth Management, Inc. love to see; success is possible.

So if you want to develop a winning strategy and learn to control the uncertainty in your trades, develop a trading plan that conforms to your risk tolerance and the markets you like to trade.  Haven’t written your FOREX Trading Plan?  Get with it and experience increased FOREX trading success. 

CONTACT US FOR A FREE CONSULTATION; LET US SHOW YOU HOW HAVING A FOREX TRADING COACH IS NOT AN EXPENSE BUT AN INVESTMENT IN YOUR FUTURE SUCCESS.

Doji... It's a Japanese Candle Stick that foretells a change.

Some Japanese candle sticks can tell you when change is in the air, or should I say the FOREX Market.  Candle sticks used in a series can tell the tale of the FX Market sentiment just by the way they interact on your chart.  Using them correctly, like reading this blog, can help forecast the future so to speak.  In every trade, when to get in, when to get out, and when to tighten your stops are critical questions to ask when it comes to capturing a profit or reducing your loss especially in the fast moving FOREX Market. 

A Doji, is a candle that provides an indication that the market has stalled, it is one of the best helpers when it comes to answering the critical questions regarding direction and configuring your risk as you updated a FX Trend Trading Strategy.  Found in four different configurations, Doji’s are formed when the entry and exit points on the candle are the same.  The lines of the candle, or wicks, above and below that point; are indicative of the markets energy, providing a hint to its next move.

Take a gravestone Doji for example.  It presents with a wick found only on top of the entry and exit point and predicts an ominous attempt to rally the FX Market into a higher position that has failed.  The bulls just didn’t have it in them to carry the market up.  When you see a gravestone after a significant upward move, look for the market to fall off as the energy may not be there to go higher.

In reverse, the dragonfly Doji is just the opposite, only a wick below the entry and exit point of the candle is presented.  As you might expect, a dragonfly can be a precursor to the market moving higher if it is found directly following a down trend.  While the suggested moves in the FOREX Market place that these Japanese Candles present, they are not always correct.

As part of your FX Trend Trading Strategies, I would suggest that you use a cautious approach and do as I do, tighten your stops allowing for some volatility in the event the market wants to continue its trend.  Usually I let the market come to me; however you may want to just exit your trade in the event you have that “gut” feeling.

At the VERY LEAST place a crash stop on your Trades!

Have you ever traded without your protective shell?  If you have placed a trade without stops then you’re certainly exposed.

While there are several thoughts about how and where to place a stop, at the very least every trade should have a crash stop in place.  This is a stop placed at a point where you know you are wrong about the markets move or trend.

One way to determine where to place your crash stop is to look at the next higher time period and place your stop above the last swing high for a short trade or below the last swing low for a long trade.  So if you’re trading the 15 min chart, use the 30 min chart to determine your crash stop for your trade.

FOREX Volume Spread Analysis, an Advanced FOREX Tactic

You've heard people talk of Fundamental Analysis and you've no doubt heard of Technical Analysis, well have you ever thought of combining both to determine the "Why" and "When" of the FOREX Market?  Or consider this; Why does the FOREX Market  move and WHEN WILL IT?  Well you have to have Advanced FOREX Tactics and that must be hard to figure out, right.  Well maybe not.

In fact, I'm talking about VOLUME SPREAD ANALYSIS, which assists in the determination of the cause of the FOREX Price Movement, and well will also apply still to Stocks, Futures, and Options evaluations.

In Volume Spread Analysis you use essentially three variables on your FOREX charting system to help you determine the balance of supply and demand as well as FOREX Short Term Market Direction.  These variables are the FOREX Spread of the Period, that is the Period High and the Period Low of the bar or candle in question and the volume during the formation of that bar.

With this information there REALLY IS ONLY FOUR CONCLUSIONS that can be made.  FIRST, there was Accumulation during the period; SECOND, there was Distribution; THIRD, there was Markup; and last there was a Mark Down in the FOREX Market Price.

Richard Wyckoff in the early 1900's began what can be categorized as the precursor to the Volume Spread Analysis process that we know today and can use in any market, especially the FOREX or FX Market.  Volume Spread Analysis was essentially revealed to the public in 1993 through the works of Tom Williams in his book titled "Master the Markets".  (A good book to read then have handy on your office shelf.)

Volume Spread Analysis shows us that the Strength of the FOREX Market is in the Down Periods and Weakness in the UP Bars.

THIS IS OPPOSITE OF WHAT MOST TRADERS THINK.  FOR A TRUE DOWN TREND TO OCCUR, YOU MUST HAVE A LACK OF SUBSTANTIAL BUYING WHICH CAN REALLY ONLY BE SUPPORTED BY PROFESSIONAL TRADERS.

So the next time you see a Down Period, look to the Volume, there could be more going on than you think.

Always use good money management in your trades.  Happy trading.

You've heard of Richard Dennis and his Turtles?

Well we have and we thank Richard Dennis and William Eckhardt for developing the Turtle Rules that provide a sound strategy for trading markets today.  In Market Wizards by Jack Schwager Richard Dennis commented in part "I always say that you could publish my trading rules in the newspaper and no one would follow them.  The key is consistency and discipline.  Almost anybody can make up a list of rules that are 80% as good as what we taught our people.  What they couldn't do is give them the confidence to stick to those rules even when things are going bad."

In the many years that I've been trading, sticking with my strategy and shaking the "need to trade" feeling or the emotions when things are upside down has been a hard nut to crack for me and as I've seen in my conversations with other traders, I believe I'm in good company.  Teaching consistency and discipline is a difficult task that usually reverts back to the individual and not much to outside influences. 

So, while we're developing an online seminar that will detail the Turtle Trading Rules (the story goes that Richard Dennis used the rules to turn $400 into $400 Million), I'm finding it most difficult to facilitate the inclusion of consistency and discipline in the seminar.  I believe that it's not necessarily the fact that we can put the rules into a seminar format and let everyone benefit from that knowledge, almost anyone can do that.  My view is that with these seminars we develop, the true benefit is, in group or private format, is the discussions and the questions and answers that follow the presentation.  We all learn from each other.

With Richard Dennis's comment being the focus here, happy trading and work on your consistency and follow your FOREX Trading Plan with diligence and discipline.  Enjoy your day.

Are you treating your FOREX Strategy as a Business?

If you're not treating your trades as a business you're just playing in the market and not serious about it. Get it together and begin to work the market for greater benefit.  Building and operating your FOREX Tactics as your business forces you to trade with a strategy.  Your FOREX strategy reduces greatly the feer and greed that can sometimes creep into your trades (it does on me sometime).  The discipline required to trade a plan that has been back tested on your FOREX historical and quantifiable information provides the control needed to succeed.  Treat you FOREX account as a small business, trade it as a trend trading strategy, swing trades, scalps or utilize a low risk FOREX tactics and make it your job to interpret the FOREX Market and implement your strategy as essentially your only job.

Since your "JOB" is to make money, using a sound FOREX Strategy and developing the discipline to make money leaves you with the intent of your focus to compound your earnings and reduce greatly the impact of a draw down.  That may mean developing strategies that will hedge your trades with a different currency.  Because of the new US Laws regarding hedging, you can no longer go long and short in the same currency at the same time, that leaves essentially the only alternative as utilizing another currency to fill that need.  To do that you need to do your research and have your plan in place or you'll get hit with a major draw down with a series of losses as you try to learn this strategy while live in the market.

Build a business, not a game, get your FX Strategy in place, learn it well, then trade it over and over again.  Your significant other will appreciate your financial genius and you'll have the great sense of providing well for your family.  It takes time and dedication to get through the rough times, believe me, it's worth it.

Happy trading, be sure to use good money management, enjoy.

Are you beating your FOREX Trader Challenges?

Do you have a written FOREX Trading Plan?  No?  You should if you want to excel.

Your Advanced FOREX Tactics for trading includes a written trading plan.  Without it, you'll not be able to achieve the absolute confidence that you need to take each and every low risk trade that you see and make money on those trades.

Your Written FX Trading Plan will detail your PROVEN and PROFITABLE Trading System! A system that LIMITS RISK in the FX Currency Market and reduces your EMOTIONAL quota when you take your trades with that confidence in knowing the truth of your system.

Is your trading system not making the money that YOU KNOW you should be making? 

It's a known fact that a written FOREX Trading Plan will increase your reward in the FX trades you take while reducing your FX Trading RISK providing the best of what you can achieve. 

Write a plan, follow it and prosper.  For you and your family.

We are experienced FOREX Traders who provide personalised FX Coaching for clients around the world.  Your success is our Prime Directive so to speak.  Learn great FOREX Strategies today!  We can help.

Always use good money management as trading is risky.

Do YOU have an Optimized FOREX Trading Plan?

Well today has been a tremendous trend day, of course the US Dollar has regained some strength and the trading has been pretty easy, go short on the confirmation of your short signals and then just follow the market down, down, down.  Have done that and if you did things right, with the right leverage and position placement during a trend, you can, in a few hours, increase your account significantly. 

OK, so everyone knows you can make money trading currencies in the FOREX market but you also should know that you can lose your entire account trading FOREX.  How do you figure this successful trading stuff out?  Specifically what I'm talking about here is a low risk FOREX Trading Strategy.  How do you know if your FOREX Trading Strategy is Low Risk?  Well you've investigated the risks of your entry and exit signals and you then take advantage of of these Trading Strategies to enter and exit the FX Market at a profit.  Do this consistently and you can make money. 

Watching your signals you determine that you're getting in way to late and you're getting out way too late, that doesn't make for low risk trading strategies or for may money, real money.  When you find yourself in this situation you need to step back and optimize your indicators for the market.   Every market has a sweet spot at any give moment and the markets change, with that in mind, if you leave all of your indicators at a specific setting, behold, they are only going to be accurate a small portion of the time and the rest of your trading is going to be hit and miss.  Optimizing isn't hard but it does take time.

Only with optimization for the current market can you really make good entry and exit decisions.  Something to remember as well, each currency pair is in it's own market and on top of that, each time frame you can trade, ie. the hour vs daily, has it's own market.  The 15 minute chart is a different, although not by much, from the 5 min chart, but the 5 min is very different from the 4 hour chart.  So it's important that you know what market you are trading and optimize your indicators for each of the individual market.

Oh, by the way, don't forget your fundamental analysis which will play a part in your trading, think tomorrows Non-Farm-Payroll.  Optimize your strategy, standardize your entry and exit strategies, and win more trades overall.

If you feel that you want some help with the optimization or if you don't have a FOREX trading plan, then we're here to help.  You should understand, that while services such as this cost money, the improvement of your trading process more than pays for this investment which is actually an INVESTMENT IN YOU!

Think about it, it does work and has for many people who now trade successful.

Happy trading, always use good money management as it's a very risky world.

Short Term Price Pattterns and the FOREX Market

Once again I've reviewed the great technical trading book by Toby Crabel "Day Trading with Short Term Price Patterns and Opening Range Breakout" Traders Press Inc. 1990.  In the book, he looks at opening prices instead of Arther Merrill's work on the Dow Jones Industrial Index which looked at volume and closing prices for patterns.  Mr. Crabel found that looking at and utilizing "Opening" price patterns and not including volume in his calculations provided him a better return than through Merrill's research. 

In my work to develop FOREX based robotic trading Expert Advisers, I found that the utilization of using the closing price on some of the indicators caused too much volatility in the operations of that robotic trader.  Like Crabel, I found that using the Opening Price in the FOREX market in some instances provided much better indication of direction and helped to make better decisions regarding entry and exit positions in my advanced FOREX tactics or FX Strategies if you will, both in manually taking a trade and through my robotic trading systems. 

When you're setting up your trading screen, check some of your indicator positions using the open price instead of the close price.  You may find better results.  Email me if you have any questions. 

Happy Trading, use good money management of course.

FOREX Trading on the one hour charts

If it's not a fast market, trading on the FOREX or FX international currency markets can be a stressful time when you're trading the longer time periods. If you're anything like me, I love trading and I have to sit on my hands sometimes like a beginning FX trader because I'm waiting for a position to present itself. That tendency, to want to trade, is one of my Top Killer Trader Mistakes and is a constant battle for me to overcome.  To help, I continue to review my FOREX Trading Plan and insure that I keep my entry and exit rules in the top of my mind. 

If I'm trading the 15 min chart I don't jump to the 5 and 30 min charts to influence where I'm going, I do however, when I see a setup on the 15 min or other chart, I go to the hour chart to confirm direction and try a high probability trade on the FX based upon the trend at hand, at least the short term trend.  I've helped develop some custom indicators which will enhance the probability of a good trade.  But as usual the market rules the roost, so I stay vigilant.

I also have a tendency to get out of a position early so using FX trading rules helps me stay in the trade longer and make more money as the trade progresses.  If I do tighten stops, like I just did on my long EURUSD trade and get stopped out (traded the one hour, gain of 512 points), I then do another top down analysis of the FOREX market that I'm trading and after determining if I'm in a consolidation or trending market I hunt for another FX entry on that pair or another. 

Trading a FOREX consolidation market is tough but very rewarding if you're an active trader.  Those that trade swing positions however have to wait for their next trending entry.  Sometimes that's a hard thing to do so when you find yourself in that position, don't push the process, wait it out and follow your rules.

Happy trading, follow your rules and always use good money management.

Personal Training Positions Open

Part of our focus at Blue Heron Wealth Management, Inc. is helping people make better decisions on their personal trading platform. If you're interested in learning more about our one-on-one training via gotomeeting.com (so you'll not have to travel and schedules are very flexible) email us at BlueHeronTrading@gmail.com for a personal response.  Most of our private clients focus on the FOREX market which we have available several optimized and custom indicators available to assist in improving your entry and exit decisions.  We are dedicated to your success.

Emerging Technology, Room Temperature Super Conductors

Tested and proven successful, Room Temperature Super Conductors are now a contender for future participation in many commercial products. Imagine your watch and phone that never needs a new battery, your lap top that you never need to plug in. These Supper Conductor developers envision a charged mass of the material that will store energy, discharge as needed and outlast the commercial or military usefulness of the unit. While everyday people will eventually use such energy storage devices in their personal products, the ability of the material to be scaled to many different sizes provides an opportunity to be exposed to a Room Temperature Super Conductor through its use in micro technologies; think little robots used in medical and technical services or perhaps micro-military applications. Once perfected, we could see these Supper Conductors in wires reducing the stresses of overhead power lines or increasing the speed of micro processors. The US Military has tested these potential products and their use in specific applications.  As in the past, military research and applications provide breakthroughs that support development and growth in space technologies, internet and our everyday lives. Looking for applications of this emerging technology is not hard, but there seems to be commercial application hurtles that every emerging technology must overcome. Room Temperature Super Conductors is no exception. Challenges remain in scaling to size, not necessarily in micro-applications, but imagine wires hundreds of miles long.  The technology has tested to transmit energy faster than gold which will accomplish one of two things, increasing speed or reducing size needed to accomplish the same task. Development costs and commercial development remain challenges for many emerging technologies, however for the Room Temperature Super Conductors; they are poised to be in our future lives, perhaps very soon.

Currency Market Still in Consolidation

Once again the FOREX currency market has found it's way into a roaping pattern as the EURUSD and GBPUSD which are the main pairs I trade, are caught in this bit of consolidation.  Trading a lower time frame with tight trailing stops is about the only answer.  Had a couple of good trades on each last evening on the 5 and 15 min charts, so today with the banks closed in major areas of Europe and Japan I believe that this pattern will continue.  Good trading and remember to manage your money well, trading is risky.