# Price Action Trading



## FXSchoolOnline (7 January 2012)

Hello all,

I can not find a dedicated thread that discussed trading forex with Price Action. I figured I may as well start a thread and see if I could get some like minded traders involved in some solid discussions and Price Action setups.

I must say up front (no hidden agendas) I am a full time trader and also part time educator/mentor. I am here however for interesting convos and discussions on all things price action trading.!

I will post a few recent setups in the next post.


Safe trading,

Johnathon Fox


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## FXSchoolOnline (7 January 2012)

*Recent Price Action Setups*

In the chart below you will see a solid pin bar at resistance with the short term trend. This pin was of the daily chart of the GBPUSD and fell into support as expected.





The following chart shows a Pin bar at a recent swing high. This formed on the 1 hour chart and just goes to show how powerful they can be when played from the right areas. This was against the short term trend however Pin Bars are reversal signals and quite often the market will change direction after a solid pin bar.






Feel free to add any comments or current or pending Price Action setups or queries.

Safe trading,

Johnathon


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## FXSchoolOnline (7 January 2012)

The following setup was on the 1HR TF of the EURUSD. This setups is known as the Bearish Engulfing Bar and is very simple but very reliable when traded from the right areas and managed correctly. To qualify as an engulfing bar the last bar must completely engulf at least 1 previous bar. The engulfing bar can engulf more than 1 previous bar. See below chart for very good example:




Regards,

Johnathon Fox


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## FXSchoolOnline (9 January 2012)

EurUsd has been in a runaway trend of late. The 4hr chart below shows a possible pullback area that traders could look for Price Action to get aboard the trend.




Johnathon Fox


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## matthewdean (10 January 2012)

FXSchoolOnline said:


> EurUsd has been in a runaway trend of late. The 4hr chart below shows a possible pullback area that traders could look for Price Action to get aboard the trend.
> 
> View attachment 45746
> 
> ...




Interesting posts, I can only see one of your chart images...

I use price action as my third indicator in my forex trading plan. I use it along with the MACD and SMA/EMA lines... I don't place a trade unless I have all three signaling for the direction I wish to trade. 

Do you use any other indicators to back up your predicition of the pullback area, I would post a chart with my analysis but I am not at home.


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## Mike Kshemaraja (9 March 2012)

This is what I am looking at, is 10.47 am my time.

My TF is 30 seconds, the yellow line are level of support/resistance, the blue lines are lines of round number( 20, 40, 50, 60, 80 and 00, the ema is 20.

What I am looking for? There are battle going on all around, my job is to spot them and join in only when one of the part does let go of the rope.

Clear focus is needed, only when I am sure of it, I take a trade, many time I miss good trades, but I do not care, I trade my odds, if all the condition are not there I pass. My best position is to stay aside.


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## Mike Kshemaraja (9 March 2012)

Tough day, today.

Market very much into the range, not trades for me till now.

From bottom to top lines only 9 pips distance.

Lets see.


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## Mike Kshemaraja (9 March 2012)

In the actual marker, however, things may not be so evident as they tend to appear from the safe distance of hindsight evaluation. In fact in the reality of a live trading environment it is very easy, and common to even miss the best looking set ups, purely a trader, at the time, does not expect the market to behave like it does. This is why it is important to not limit your thinking by imaging what is going to happen next and then needing to see it materialise. Particularly on the verge of exploiting a technical situation, this little mind-game of predicting how a set up will present itself, as if to prove your skills to some fictitious bystander, can have a detrimental effect on your ability to see the price action in its proper light. The moment you expect the market to behave and break in a certain way, and the market defies that, you stand to lose your face in your own scheme of things and it may hurt your ego just long enough to completely miss the alternative break.

"a little thought from my friend Bob"


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## Mike Kshemaraja (9 March 2012)

First trade, keep in mind that I have been working, monitoring at the chart for more then seven hours, not intensively but more of a tactical overlook.

Prices broke the bottom line of the range (1), a long range, pulled back to the broken line and printed a doji bar (short bar), as soon as prices broke his low by one pip, I entered at market.

My SL was placed 1 pip above the last swing (2), because those kind of break without pre-tension tend to pullback to the last swing, normally, not in this case though where price just stalled at the broken line and once the bull let go of the rope they became bears as well.

Made my full 7 pips, 2%. Hard day though but all part of the business.

I do not mind make 2% every day.


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## Mike Kshemaraja (9 March 2012)

My second trade of the day, similar to the first but the range was smaller.

The left side of the chart, clearly shows that the trend is down, market pulls back and forms
a range defined by the lines, also forms a double top (1 and 2).

I will start to get ready, she breaks the bottom line of the range and I do nothing because of the way she broke, she pulls back and prints a doji just at that line, I am in at market 1 pip below that doji, she pulls back twice and forms another double top (3 and 4), now I feel is working in my direction, but Im ready to get out also in case things do not work out (above the double top).

I had a larger TF and SL due to LO, my target was reached, made my 10 pips, another 2%.
4% total for the day.

Sound easy, doesn't? But is not. Doable for sure but not easy, passion will help.
Done for the week (trading). Take care.


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## Vixs (30 March 2012)

I have been getting back into Forex after my last foray into it led to me finishing up after a whole lot of trades with exactly what I came with.

Lessons learned were many, including that I need to be more disciplined with sticking to my risk management strategy and sometimes less indicators are more useful.

I have found my most successful trades over the last few days were just trading on pairs that were stuck in a channel, buying/selling as they rebounded off the support/resistance. 

Pay day next week and with it my first deposit into a live account.

There is interest in the Forex forum here I believe, it's just very quiet.

Happy trading.


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## jr689 (27 June 2012)

Hi guys, very new to ASF but hoping to get involved with some forex related discussions from here on in... Will be looking to get involved with stocks too, but for now I'm happy with forex.

Big fan of price action trading, so I'll be watching this thread like a hawk to see what other like minded traders are thinking.

If you haven't heard of price action before I'd suggest you do a bit of a research into exactly what it is, as it is a very simple approach to trading and it's the most consistent, but that's just my opinion.

Anyways a pair that I'm currently looking at is GBPJPY. There is a bullish Pin Bar on the daily formed off of a support, the daily trend is up, EMA's have crossed over suggesting bullish bias and we are at a swing low of the recent bullish move.







I will be setting a long pending order as per all of this and see how it goes. Would be good to hear people's comments and opinion's.

jr


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## jr689 (27 June 2012)

My setup is as follows:

GBPJPY
Long @ 124.309
SL @ 123.425
TP @ 126.477

SL is placed 10pips below the low of the pin bar, TP is placed targeting previous near term support/resistance.

jr


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## CanOz (27 June 2012)

jr689 said:


> My setup is as follows:
> 
> GBPJPY
> Long @ 124.309
> ...




Price action is just so incomplete without volume. I think i would only trade FX again using the futures contract. Otherwise an automated system. Discretionary trading from a chart only just doesn't work, for me.

Good luck.

CanOz


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## jr689 (27 June 2012)

Thanks for your comment canoz, each to their own I guess. You should give it more of a solid shot I think?

As for automated trading I'm guessing you're talking about a robot? I wouldn't touch one of those with a barge pole to be honest 

jr


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## CanOz (27 June 2012)

jr689 said:


> Thanks for your comment canoz, each to their own I guess. You should give it more of a solid shot I think?
> 
> As for automated trading I'm guessing you're talking about a robot? I wouldn't touch one of those with a barge pole to be honest
> 
> jr




I just don't see how you can get an edge looking at a chart intraday? Chart patterns don't work as well as they used to, Thomas Bulkowski has proven that recently. They've lost thier edge.

Perhaps you can change my mind with some clever examples of Real Time trades.

CanOz


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## jr689 (27 June 2012)

That's fair enough mate.

Well that GBPJPY long is a 'real time' trade.

I have just taken a GBPNZD long which I will post up now for you.

I'm not saying any of these trades will definitely come off or that price action, pin bars, etc, etc, are foolproof but they definitely do work well from my findings as long as they tick all the boxes and meet all the criteria.

jr


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## tech/a (27 June 2012)

CanOz said:


> Price action is just so incomplete without volume. I think i would only trade FX again using the futures contract. Otherwise an automated system. Discretionary trading from a chart only just doesn't work, for me.
> 
> Good luck.
> 
> CanOz




Yeh I think it will give an edge if you understand what its telling you.
Still you can pattern trade without it.
Must go and pack my parachute.
Then again I could jump without it.


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## jr689 (27 June 2012)

GBPNZD
Long @ 1.97896
SL @ 1.96690
TP @ 1.99507







jr


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## jr689 (27 June 2012)

tech/a said:


> Yeh I think it will give an edge if you understand what its telling you.
> Still you can pattern trade without it.
> Must go and pack my parachute.
> Then again I could jump without it.




What sort of patterns are you referring to if you don't mind me asking? Have you or do you trade in this manner and with what sort of success? Cheers tech/a!

jr


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## 5oclock (27 June 2012)

Gday JR689, just a couple of questions, looking at GBPJPY daily on IG markets there is no pin bar, just a doji and similar on the kiwi again on IG. more correctly on the kiwi the pin bar is inverted. Just wondering what platform your useing there please. Second question, how long have you been trading price action and what books have you found worthwhile on the subject?


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## CanOz (27 June 2012)

5oclock said:


> Gday JR689, just a couple of questions, looking at GBPJPY daily on IG markets there is no pin bar, just a doji and similar on the kiwi again on IG. more correctly on the kiwi the pin bar is inverted. Just wondering what platform your useing there please. Second question, how long have you been trading price action and what books have you found worthwhile on the subject?




Oops, there one reason for not liking charts on their own...one mans doji is another mans pin bar

CanOz


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## jr689 (27 June 2012)

5oclock said:


> Gday JR689, just a couple of questions, looking at GBPJPY daily on IG markets there is no pin bar, just a doji and similar on the kiwi again on IG. more correctly on the kiwi the pin bar is inverted. Just wondering what platform your useing there please. Second question, how long have you been trading price action and what books have you found worthwhile on the subject?




Hi 5oclock, basically the problem there is that IG Markets' server time would be set to a different timeframe...

From what I have been told in terms of price action and being able to see the correct signals, you want your brokers server time to be that of New York i.e. each daily candle closes the same time the NYSE closes. Hope that makes sense.

The platform I'm using is MT4 and that is the only platform my broker offers.

I have been trading for a little under two years in total, with the past 6 months solely being that of price action. I am a completely different trader now because of it and that's a good thing. How long have you been trading?

As for books, can't say I have read anything so wouldn't be able to help you there unfortunately mate.

jr


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## jr689 (27 June 2012)

CanOz said:


> Oops, there one reason for not liking charts on their own...one mans doji is another mans pin bar
> 
> CanOz




Very very very true CanOz!

However my previous post covers this kinda-sorta... I guess NY is basically the be all and end all of the markets, hence why NY server time is the preferred time for this style of trading?

jr


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## 5oclock (27 June 2012)

JR689, yes I guessed that was the problem, but what I was trying to get at was it your prob or IG .I dont know if their charts are set to NY close I just assumed that they were. Anyhow , on smaller timeframe any difference should be less of a problem. So is daily only time frame you are trading price action? Also I asked about books ect, was wondering if you or any other ASF member had read any of AL BROOKS, WALTER PETERS and what you feedback was. Have them myself and pretty heavy going on Al Brooks ( very large 3 volume set) but most of what I have read so far has made sence.


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## jr689 (27 June 2012)

Best way to find out if they are is just flick customer support an email and ask if the daily charts are New York close... That's what I did and luckily for me they were otherwise I would have had to change brokers, which is something I definitely did not want to do!

I've traded H1, H4 and D1... And I am now starting to have a look into W1... I'm trying to steer away from H1 and H4 from here on in as I haven't really had much success with them to be honest, so I'd suggest to just stick with the daily's mate.

This week I took my first weekly setup, so I'll have to wait and see how thing's go with them over the next fortnight or so.

I'll have to have a look into that book, what's it about? It's educational I'm guessing?

jr


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## 5oclock (27 June 2012)

JR689--They are 2 different authors I was refering to, Al Brooks who has 4 books , the 3 I have are called trading price action trends,trading price action trading ranges, trading price action reversals. These 3 books are sort of a second edition of an earlier book which by all acounts was a real difficult read. the other book is Naked Forex by Walter Peters which is an easy read but much briefer.I am currently trying to put some of these strategies to work but on m15 and h1 type time frames . Walter Peters leans more to d1 like your self and I thought you may have seen his work and was after your take on it. Yes I have been stumbling around the markets for a couple of years and have progressed to the stage where I am not a total looser any more, bad news is am not a winner yet either. But ASF, or more correctly the VERY helpfull and generous contributors to the forum have helped me and hundreds (may be more) of others see a glimpse  of the light at the end of the tunnel.


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## tech/a (27 June 2012)

jr689 said:


> What sort of patterns are you referring to if you don't mind me asking? Have you or do you trade in this manner and with what sort of success? Cheers tech/a! jr




Yes mixture of Pattern / VSA and 18 yrs as a Chartist.
Success I'm still doing it----



5oclock said:


> JR689, yes I guessed that was the problem, but what I was trying to get at was it your prob or IG .I dont know if their charts are set to NY close I just assumed that they were. Anyhow , on smaller timeframe any difference should be less of a problem. So is daily only time frame you are trading price action? Also I asked about books ect, was wondering if you or any other ASF member had read any of AL BROOKS, WALTER PETERS and what you feedback was. Have them myself and pretty heavy going on Al Brooks ( very large 3 volume set) but most of what I have read so far has made sence.




Just received the Al Brooks books today!!!
Let you know in 6 mths when I've read them.


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## 5oclock (27 June 2012)

tech/a said:


> Yes mixture of Pattern / VSA and 18 yrs as a Chartist.
> Success I'm still doing it----
> 
> 
> ...




Unreal , I was wondering if you had them. They are pretty heavy going, what I have read so far TECH ,but I think I will get a lot out of them! Much of what Al says makes sense and explains a lot to me , stuff ie price action that always had me wondering. From previous in depth volumes I have read I think I will have to read some of it 3 or 4 times.


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## jr689 (27 June 2012)

5oclock said:


> JR689--They are 2 different authors I was refering to, Al Brooks who has 4 books , the 3 I have are called trading price action trends,trading price action trading ranges, trading price action reversals. These 3 books are sort of a second edition of an earlier book which by all acounts was a real difficult read. the other book is Naked Forex by Walter Peters which is an easy read but much briefer.I am currently trying to put some of these strategies to work but on m15 and h1 type time frames . Walter Peters leans more to d1 like your self and I thought you may have seen his work and was after your take on it. Yes I have been stumbling around the markets for a couple of years and have progressed to the stage where I am not a total looser any more, bad news is am not a winner yet either. But ASF, or more correctly the VERY helpfull and generous contributors to the forum have helped me and hundreds (may be more) of others see a glimpse  of the light at the end of the tunnel.




Cheers for that, going to have a look into these books right now!

How have you been going on those timeframes? Good success rate?

jr


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## tech/a (27 June 2012)

5oclock said:


> Unreal , I was wondering if you had them. They are pretty heavy going, what I have read so far TECH ,but I think I will get a lot out of them! Much of what Al says makes sense and explains a lot to me , stuff ie price action that always had me wondering. From previous in depth volumes I have read I think I will have to read some of it 3 or 4 times.




Just had a very quick look at " Trading Ranges "
I like to read what other people's life's work has 
Turned up. Brook's books are really detailed.

But one thing I have noticed with many of these
Very deep thinkers ( to early to tell with Brooks )
Often seem to want to explain EVERY BAR and 
EVERY PATTERN. 

I really don't know that that is necessary.
Infact my own trading proves that you really 
Don't need to explain every single bar and or 
Pattern.


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## 5oclock (27 June 2012)

You are on to him TECH , he is a deep thinker and I think he leans toward explaining every bar as you say.However I will be very interested on your analysis of Al's books( like you said it seems to me to be a lifes work). JR689- results have been mixed, between mediocre and less mediocre, if you know what I mean, but its price action in the fast lane as you know and would have to watch years of weeklies to get same action on m5 or m15. I am still learning and trying to get a couple of stratagies to work, and then maybe translate them to higher time frames. Anyhow thats the theory, seems to work at times. Quite a bit of info on pin bars or kangaroo tails(thats what Walter Peters call em) on the net, just some of it not so well researched.


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## jr689 (27 June 2012)

So yea did a bit of research and just as you said, Al Brooks is more of a price action "scalper" whereas Walter Peters is more medium term focused?

I definitely think the Walter Peters approach is for me, much more relaxed than looking at M5-M30 timeframes that's for sure.

As with your results being mediocre, I think you will find that when you focus more on D1 timeframes as per the Naked Forex book, that that mediocrity will turn into consistent profitability. In my opinion there is just too much going on in those lower timeframes and subsequently there are a lot of false signals.

That's just my point of view, but definitely let me know how the naked forex book is as I'm very inclined to purchase it!

jr


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## jr689 (27 June 2012)

jr689 said:


> This week I took my first weekly setup, so I'll have to wait and see how thing's go with them over the next fortnight or so.
> 
> jr




As mentioned earlier, see below for this setup.







USDCAD
Short @ 1.02399
SL @ 1.03347
TP @ 1.00099

jr


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## 5oclock (27 June 2012)

JR689--Agree with all you said. Walter Peters is real big on trading off support and resistance, and one of the things I am doing on the small time frames is honing my S and R skills, easier said than done sometimes as you could fill the whole area with S R zones if you go to M1. But I am  getting ""it". There is another book I am also reading(cannot have to much training going on at once!) you might like to look at too, but it is as title says. It is FOREX PRICE ACTION SCALPING by Bob Volman. Look I am on ASF often but dont post much cause most of the time there are beter traders than me posting and if you cannot add worth you probably should not post. Hey if you are new here you owe it to yourself to read the whole PEN thread , word of warning though not with a full bladder!!! I thought I had made the wost mistakes ect .Anyhow back on topic, I am leaning toward longer time frames as you say but more H4 to H1 for FX..Any way will report back soon re that book, naked forex and what results I am getting.


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## bunyip (28 June 2012)

jr689 said:


> GBPNZD
> Long @ 1.97896
> SL @ 1.96690
> TP @ 1.99507
> ...




It didn't concern you that you were going long when the daily trend was strongly bearish?

In trading I've had more success swimming with the current than against it.


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## bunyip (28 June 2012)

jr689 said:


> GBPNZD
> Long @ 1.97896
> SL @ 1.96690
> TP @ 1.99507
> ...




Also, your profit target is only about 1.3 times your risk, by my calculation......I would have thought that's a bit light on.


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## jr689 (28 June 2012)

bunyip said:


> It didn't concern you that you were going long when the daily trend was strongly bearish?
> 
> In trading I've had more success swimming with the current than against it.




Yes with the trend is much much much more higher probability, however I felt with the pin bar off support then the subsequent Mother Bar with Inside Bars was good enough reason to long from here.

Subsequently I have been stopped out on this trade, however, risk was calculated in before I entered the position and wasn't a great deal anyway due to being counter trend and all.

I do try and steer clear of counter trend trades for the most part but every now and again I have a small shot at them so long as it looks promising as this one did.

jr


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## jr689 (28 June 2012)

bunyip said:


> Also, your profit target is only about 1.3 times your risk, by my calculation......I would have thought that's a bit light on.




Yes, generally I try and aim for 1:2 or 1:3 (risk:reward) where possible.

Anything better than 1:1 is good, your risk should never be greater or equal to your reward.

As long as you make your reward greater than your risk for all trades, you can 'essentially' lose more trades than you win and still turn a profit. It's a little more complex than that though but the main thing to realise here is to ALWAYS have a greater reward!

jr


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## tech/a (28 June 2012)

jr689 said:


> Yes, generally I try and aim for 1:2 or 1:3 (risk:reward) where possible.
> 
> Anything better than 1:1 is good, your risk should never be greater or equal to your reward.
> 
> ...




ALWAYS?


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## jr689 (28 June 2012)

tech/a said:


> ALWAYS?




That's my opinion...


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## jr689 (28 June 2012)

Would you suggest otherwise


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## tech/a (28 June 2012)

jr689 said:


> Would you suggest otherwise




In general terms yes.

I often see people quoting R/R based upon a price somewhere in the future
and a stop level at X difference being their ratio.
As you have.
In itself it is quite meaningless as it at best is an anticipated figure.

The closed trade figure will determine your *ACTUAL R/R.*
You can manipulate the figure by simply moving to B/E as soon as you can your anticipated R/R may ne 1:0.5 
but in reality your closed trade R/R could be vastly different.

One I use often I picked up on the SPI thread by Trader Girl--with a twist of M/M from myself.
Its simply fading very high volume moves at resistance or support.
Initially using a 10 tick stop and looking for a 5 tick profit.
It has a particularly high win rate --- around 75% so 7.5 x 5 ticks = 37.5 tick to 25 tick loss.
a 1:1.5 R/R.
My version is closer to 1:2.4

My win rate is 65% though---Ill leave it to you work that out!

Good trade management will see far better closed R/R. than anticipated R/R if trading discretionary.


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## jr689 (28 June 2012)

Would you mind linking me to this thread/post please tech/a if it isn't too much trouble?

I'm always keen on learning new things. Thanks for explaining that to me, greatly appreciated.

jr


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## tech/a (28 June 2012)

jr689 said:


> Would you mind linking me to this thread/post please tech/a if it isn't too much trouble?
> 
> I'm always keen on learning new things. Thanks for explaining that to me, greatly appreciated.
> 
> jr




https://www.aussiestockforums.com/forums/showthread.php?t=22820


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## bunyip (28 June 2012)

jr689 said:


> GBPNZD
> Long @ 1.97896
> SL @ 1.96690
> TP @ 1.99507
> ...




Don’t know about your broker, but mine has about a 2 point spread on NZDGBP, and a 9 point spread on GBPNZD. The two charts are the mirror image of each other – you’re better off trading whichever one has the tighter spread.


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## jr689 (29 June 2012)

tech/a said:


> https://www.aussiestockforums.com/forums/showthread.php?t=22820




Thanks for that tech/a, greatly appreciated!

jr


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## jr689 (29 June 2012)

bunyip said:


> Don’t know about your broker, but mine has about a 2 point spread on NZDGBP, and a 9 point spread on GBPNZD. The two charts are the mirror image of each other – you’re better off trading whichever one has the tighter spread.




Hi Bunyip,

I got stopped out on this trade unfortunately, but my broker doesn't offer NZDGBP only GBPNZD?

My spread is about 5 points for GBPNZD.

jr


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## Trembling Hand (29 June 2012)

tech/a said:


> One I use often I picked up on the SPI thread by Trader Girl--with a twist of M/M from myself.
> Its simply fading very high volume moves at resistance or support.




AAAAAAAAAaaahhahahahah

Welcome to the word of scalping like a punch drunk ice addict Tech. Whoever would of thought??!!


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## tech/a (2 July 2012)

Trembling Hand said:


> AAAAAAAAAaaahhahahahah
> 
> Welcome to the word of scalping like a punch drunk ice addict Tech. Whoever would of thought??!!




Not to your level T/H.
But do some short term stuff.
Nothing like 50-100 trades a day.


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