02.11.2010 EUR/USD Live Trade

Posted by Fetor 34 Comments

This is a trade I took today on the EUR/USD. In this video I try closely record the monitoring of the trade so you can see what I’m thinking about as the trade is developing. You can apply these things to failing trades as well in order to protect your capital and get out of bad trades before you are in too deep.

If you have not already watched the GBP/AUD live trade video from my previous blog post be sure to do so as it captures a higher frame entry with an extended target.

Jack

Hi,
How did you know to shoot for 1.3680?????

p.s. I like your site, i’ll be taking a good read through everything over the next few days. Thanks

http://www.forex4noobs.com/blogfet/ Fetor

Jack,
I try to follow price turning areas based on S/R and how that affects market psychology and supply and demand. Targets have much to do with ranges that form on various time frames. Those ranges help in determining entry points and exit points. 1.3680 is a an area where buying and selling has taken place consistently over the most recent history. At present the price is sitting around this price and looks to probably move higher on continued buying as the sellers lost slight control. The tight range that has formed on lower levels will help clue us in to a long or short off this level.

Rob J

Once again Fetor, fantastic video, I would like to thank you for your insight, you ability to explain things to the rest of us and for not blocking out the profit numbers, nick says we should count money as much as pips, because both matter. Its nice to see your trade numbers, so we have a good idea of where we can someday be with Hard work and determination!!!!
Jack

Hi Fetor,
thanks for your reply. I have been trading for a while now but i’ve always found targets to be a bit of a shot in the dark. Often i’d get 50 pips and bail through fear of a reversal and losing it all. I recently began using daily pivot points. An area i’d like to ask for your opinion on. Good/bad, pro’s cons etc.

I’m primarily a fundamentals trader.
I never much liked technical analysis. Too many of them talk about lagging indicators which I am skeptical about because they lag.
I like your back to basics approach of support/resistance (bulls/bears) about what a price actually means.
I follow the news and trade it. The fundamentals all point to a lower EUR/USD
but one cant just blindly sell because of the volatility in between. Your site has certainly answered a few enigmas for me.
Thank you.

http://www.forex4noobs.com/blogfet/ Fetor

Jack,
True over a larger period of time your fundamentals will give you insight to direction. You gave the example of EUR/USD, and true the fundamentals over time lend to a selling sentiment, but the gradual move is filled will volatility and buying and selling. That is where the technical approach comes in and allows us to evaluate within a certain range where buyers and sellers might be and then trade it with tighter stops and lower risk.

Miguel

Fetor,

Again thank you so much for the great video. It is just incredible how you can tell which support to choose from between all of the supports there have before.
I’m really impressed!

Keep it up Fetor, cause you are of a great help!

And my question from my other post is still valid:
—
“You know I am following you since day one, and I have looked all your videos, followed all your webinars and you are always impressing me. I like your trading style and your explanations. They are simple and precise.

I am just wondering if you do some mentoring program?

If so is it possible for you to contact me? Can you see my email or how can we do to enter in contact?

Thanks again and cheers!”
—
Miguel

http://www.forex4noobs.com/blogfet/ Fetor

Miguel,
I’m sorry, but I do not do any personal mentoring.

http://www.musclemass.com.au Karim

Awesome video, im really impressed Fetor i trade alot like you. Your trading style has no flaws in it and your risk to reward is always tempting.

Just wanted to ask you a couple of questions on your trading.

What lines are stronger, horizontal support and resisitance like the one you just traded off in the video, or trend line support and resisitance like that channel you have drawn on the daily.
And you don’t care about fibs do you?

http://www.forex4noobs.com/blogfet/ Fetor

Karim,
Your horizontal lines are always more important in that they represent where the market is setting the price as a point of reference for entry and exit. Range contains the price, trend lines move the price through the range. Higher frame areas of s/r generally pay more because they have been established over a greater period of time. Trend lines are important but sit on top of your S/R to guide the price and give you the sentiment of the market so you know when to buy and sell. I do not use fibs other than to occasionally check how they line up with s/r. I have nothing negative to say about them. Many traders use them with great success.

dallia

Well done Fetor. Your videos verissmo reminds of the great neorealismo film directors of the Italian cinema, De Sica, Rosselini and Visconti. The emphasis on risk and the importance of temporality and the use of a unprofessional narrator reminds me of the opening sequences of Roma citta operta (Rome Open City). Otherwise it’s a good honest video and very true to your trading style. your targets often mystify me but when you apply your jewel’s eye you see diamonds where others see space, which as we know is an implicit criticism of space in its more superfical forms.

http://www.forex4noobs.com/blogfet/ Fetor

Dallia,
I’m glad I had just downed a whole bag of shrooms just before I read your comment.

Miguel

Fetor,

Thanks for your answer.

Would that possible to do a video or webinar on how do you approach a chart from scratch placing S&R lines as well as TL’s. And later what do you do/wait for before you take a trade and when you take a trade.

I mean something like a video resuming a “Fetor’s preparation day” and a “Fetor’s putting everything together and taking a trade”.

I would like to understand more how you place your lines. What do you look for and mostly when do you know that S&R lines are stronger areas than others.

That would be awesome really!

Cheers,
Miguel
Miguel

Hi Fetor,

Another question regarding S&R lines/zones.

Do you place them on your 4H chart or also on other TF’s?
If you place them on other TF’s as well, do you make them appear only for the TF you are looking to, or you can see them cross TF’s?

Thanks for your confirmation. I think a video on how to place S&R lines/zones as well as TL’s would be definitely helpful.

I love the way you trade!

Miguel

http://www.forex4noobs.com/blogfet/ Fetor

Miguel,
I have a separate chart for every time frame. I use a M5 (M15), H1, H4, D1, W1. Your H1 lines should show up on H4 and some H4 should show up on D1. The higher frames are close enough together that this is the case. Your lower frames M5 and M15 will see near term s/r which is s/r between your higher frames. The most recent video post I did of EUR/USD deals with those lower lines. I talk about the way the lower frames create the “building levels” just like the higher frames do, so that it’s levels upon levels of price movement. Varying time frames can help you establish where the market is setting price (that’s what s/r is) so compare your H1 and H4 for example to see where the levels of the building (price ranges) are being defined. This will be your point of reference for taking trades. Your trend lines will then come behind this and help guide the price through the levels and help you establish which direction you should be trading.

MiG

Fetor,

Thank you for taking the time to answer my message. I really do appreciate it.

In order to make sure I understood correctly what you explained me I will repeat what I understood and you can tell me if it is correct or not.

You said you have separate charts for every time frame, that means that you have 6 different “windows” with the same currency, let’s say GBPJPY.
1 window with the 5M
1 window with the 15M
1 window with the 1H
1 window with the 4H
1 window with the 1D
1 window with the 1W

Then you draw your S&R lines on the different TF’s and make them appear on the next higher TF.
That means that for example you will draw your S&R lines on the 1H chart, and make them appear on the 4H chart (with different color) for when you switch of TF.
And you will do the same with the 4H chart, you will draw your S&R lines (with different color) and make them appear on the 1D.
Or you simply draw your S&R lines on the different TF’s and you only compare them (the levels) with the rest of the TF’s without making them appear on higher TF’s?
I know this part is a bit confusing, you may not understand but I really want to make sure I understand what you say, as it is important.

Then what I understood is that it is important to see the different levels on the 1H and 4H chart for example before taking a trade and that TL’s will only come after to help me find the direction (i.e. the trend).

I would like to share with you an example sending you a chart picture with different things I want to share with you, but I am not sure I can attach a chart here in order to make it clearer.
Do you know if it is possible?

http://www.forex4noobs.com/blogfet/ Fetor

Miguel,
Yes, I have a separate window for each chart, though I toggle back and forth between M5 and M15 so there are 5 charts for each pair (1. M5/M15, 2. H1, 3. H4 ,4. D1, 5. W1). GFT uses “workspaces” so I make a workspace for each pair and then in each workspace you customize the charts you want, etc. I can then flip through my charts for each pair quickly and easily.

I put lines on higher frames separately and then compare. I only put lines on smaller frames when I’m looking to trade and then take them off when price moves and I don’t need them anymore. If the price returns to that area again I’m watching it on higher frames so then I’ll put lines back in on lower frames as needed.

What is beneficial about multiple time frames is the number of bars/candles (depending on the style you use) that you get with each. One H4 candle will provide you with 4 H1 candles. The H1 candles over that four hour period give you a glimpse at how the buyers and sellers are behaving at a certain price. You can see closes and opens, etc. You can see strength of candles, for example, if a candle’s open and low are the same and it’s high and close are the same you have a very strong sentiment over that hour. One H1 candle will provide you with four M15 candles or 12 M5 candles and you can see buying and selling in the near term. So you can use multiple frames to help you decide when to enter or exit as you monitor your trade or decide to enter the market around areas of buying and selling. The areas we are most concerned about are the areas were previous buying/selling has taken place. We only have past history to use in trading current conditions. It’s that way for everyone and every institution.

My email is fetorforex@gmail.com.

PipCounterz

Thanks Fetor – that really help with my understanding of setting up a trade on a higher timeframe and ‘monitoring’ via lower timeframes. I keep reading that everyone says not to watch the noise on the lower timeframes but I find it very helpful in evaluating my trades and after watching this video I can say that what I am doing is very similar to that video – that clears it up for me.

thanks again.
Jacque

http://www.forex4noobs.com/blogfet/ Fetor

Jacque,
Just remember though that monitoring a trade on lower frames (beyond looking for an entry) is not to be done if you are holding the trade for a longer period of time. With the trade in this video I was looking at a 60 – 80 pip move intraday, but on the previous GBP/AUD trade I posted on the blog I did not use the lower time frames to monitor the trade since the target was much further away. At that point you are using the higher frames to monitor using your higher frame signals to exit the trade. If I had used lower frames to monitor the GBP/AUD trade I would have gone nuts and probably exited the trade long before it was able to develop. So, when using the lower frames to monitor a trade you need to use it at the right times for the right trades or you will end up screwing up trades you expect to hold longer than intraday.

PipCounterz

Thanks – I am an intra-day trader – kinda works with my personality and how my brain is programmed. I am still shooting for small pips – say 10-30 so the smaller timeframes suit me well.

Once I get my head around holding trades for longer I will take what you said into account – thanks again.

Cheers,
Jacque
Miguel

Hi Fetor,

I sent you an email yesterday with the charts and questions.

I’m not sure if you got it or not. Just let me know.

Thanks for everything!

I looked again at the video I bought that you recorded, it’s really great! You inspire me!

Cheers,
Miguel
Naga

Thank you so much Fetor. (My first comment).

You are the best I have come across so far. And would you mind posting some not-so-successful trades so we can learn something as to how to deal with those as well.

Naga.

- Be Open. Be Aware. Be Humble.
Val

HI Fetor
I’ve bought your video course and it’s great. I think you mentioned that you trade some currencies on smaller time frames. Which currencies are those?e.g I’ve noticed that you trade the EUR/USD on a smaller time frame. Any others?

Thanks

http://www.forex4noobs.com/blogfet/ Fetor

I use M5/M15 (toggle between these), H1, H4, D1, W1 on all pairs I look at to give me a well rounded picture of what is taking place.

trub

I have queried this before but here goes again.
If you produced the video 11th Feb and have had many comments on it during February, why have I only now just received it? Why could I have not receive it when you first issued it? Is it issued to “paying clients” before the “masses”?
Great presentation as always but would be better to get it within days of issue.

http://www.forex4noobs.com/blogfet/ Fetor

Trub,

There are no paying clients or distinction we make between persons. The blog is free to any who wants to view it. There is no tiered system of some sort based on purchased memberships. I’m not sure why you are experiencing this.

dallia

I think thank you would be more appropriate or an apology. Fetor shares his time and insights with people for free and he’s a professional full time trader. Most don’t.
trub

Not that I think it has anything to do with you Dallia ,especially as you received and had the opportunity to comment on the presentation on 11th February, but my only point was I received it on 30th March and was merely trying to find out if I could receive it earlier. I have absolutely no criticism with Fetor and/or his presentation etc whatsoever and if I have caused him any offence then am happy to apologise, although I don’t believe his response indicated any such offence.

Trub
NeilA

Thanks Fetor enjoyed watching this and learned a lot. On to the other vids now.
trub

I admire the way you remain so in control when trading, a traite I wish I could acquire.

As for the trade itself, having raised the stop loss to breakeven, why do you not raise it further as the price continues to rise so that you are guaranteed a profit should the trade suddenly and rapidly reverse against you?

http://www.forex4noobs.com/blogfet/ Fetor

Trub,

I generally do not use a trailing stop intraday only because I have been burned more than it has saved me. Because the price is fluctuating, a pull back to a trailing stop can take you out of a trade that would have yielded more profit. At that point it is counter productive to my overall trading strategy which is to hang on to my winning trades and reduce the amount of my losers by dumping them or placing accurate stops. Most traders and investors find themselves on the other side of that equation.

On a longer term trade, say one that you are holding for many days or weeks, your strategy may be a bit different in that you have greater distances of price movement and therefore may opt to use a trailing stop so that when the sentiment shifts you are out with profit. With intraday trades you are not worried about sentiment shifts as generally your targets are smaller, usually 150 pips and lower. So in the case of a longer term trade I would incorporate them into the strategy and move up stops to lock in profit if the trend breaks down.

This has just been my experience with using trailing stops, but I do know traders that use the religiously. Depends on how they fit with your trading strategy.

janson

Hi Fetor,

I appreciate all the work you put in your blog and video course. I really like your way of trading and I would like to join Miguel in his request for a video how you set your S&R and trendlines. Sometimes I’ve seen even parallel lines.
There is lots of stuff out there how to draw trendlines, channels etc., and if I apply them my chart looks like a mess sooner or later.

Since there are so many different ways to draw them (highs, bodies,…) it would be nice to watch someone who seems to have a clear methology..

http://www.forex4noobs.com/blogfet/ Fetor

I’ll try to pull together a video with some of that stuff in it. I don’t know when that will be as I’m working on a big project right now, but I’ll try to make an effort to do so.

janson

Thanks, I’m looking forward to it.

May I ask if your big project is about educational stuff?

http://www.forex4noobs.com/blogfet/ Fetor

Yes, it is on educational material, but I’m not sure when I’ll have it done….looks like late summer early fall.