Forex: Wednesday, May 19

Short AUD/USD @ 6983

Target 6962

Stop 6999

How do you choose your trades?

How do you decide which direction you want to trade? How do you decide when to enter? How do you pick your targets? How do you decide when the market is going against you?

I'm strictly a support and resisitance trader - I draw horizontal lines across the chart at areas where the price peaks or bottoms, these are my support and resistance areas.

Once I have a few support and resistance lines I wait for a failed move on one of the lines - a double/tripple top or bottom.

I also draw trend lines to determine if the market is going up or down.

Once I get failure I enter - usually in the direction of the trend, but against the trend if I feel the market is over bought.

I'm asking what you guys use for entry/exit indicators
because I see so many trades that yeild 40, 50, 100 pips and the most I usually get is 10-15 pips.

Discussion would be appreciated.

Oh yeah, my trade is still on the good side of break even, but as usual I might have entered too early.

I entered on what I thought would be a failed double top, but it looks as though we're going to get a head and shoulders pattern, then I'm looking to close the trade near the low of the morning.

{Karl slams top of monitor to drive price down}

DOWN DAMMMIT! DROP YOU SON OF A BITCH! Why if I had me a piece of rubber hose I WOULD BEAT YOU SO BAD!

Price dropped 3 pips during my last outburst.

2:15 Switzerland Trade

2:45 France GDP Q1, first details

3:30 Italy Trade Balance

4:30 UK BoE MPC minutes

5:00 Eurozone Trade Balance

8:30 Canada International Transactions in Securities

Close @ 6971 for +12 pips on 15,000 units.

I think part of my problem in getting big profits is that I think in terms of waves - when I see one wave that goes in my direction I have a hard time letting the market go against me while I wait for another wave.

The market's now @ 6964, it will probably hit my orginal target, just did. Dang.

Gotta learn to let the winner run.

Just busy with a possible merger, should ave a bit of free time tomorrow. No trades open at the moment. You look to be doing quite well though.

How are you finding the AUD/USD pair?

I find the aud/usd pair easier to trade than EUR/USD.

That pair (eur/usd) always seemed to turn when I thought it wouldn't, push through strong resistance areas. It seemed as though the players in that market drove the price erratically, tougher game.

"You look to be doing quite well though."

A couple of good trades and my account is up just over 9%. I'm trading 15,000 units per trade, about the most my meager account will allow.

I'm waiting for the aud/usd to get back up near 6995 then I'll look to short again.

What kind of merger are you working on?

I'm waiting for the price to get up near 6997 again, then I'm going to go short, looking for a drop to near the low of day (6950).

This trade may take a while to set up, and longer to work out - I'm going to work on my patience.

Up to 6994 then dropped.

Normally I'd be kicking myself for not entering short, but I want to wait for a failure on the high, maybe a head and shoulders rather than a double top.

Down to 6985, 9 pips (of which 3 would be transaction cost).

One thing I miss about trading the NQ is that one point move covered the round turn transaction costs - 1 point = $10 and the broker's fee was $4.80.

16 pip drop. Makes me wonder about the wisdom of my waiting.