GBP/USD update

You cannot win them all.

It looks like we might get stopped out on our GBP/USD trade. This is what happens when you take a trade that is counter to what the higher time frames are telling you. But it is not over until we are officially stopped out. Unfortunately I was not in front of my computer this morning  to adjust my stop-loss to break even before the aggressive move from the bears took price below our entry.  Now we have no choice but to sit back and see if price comes back into our favor. If not then it is what it is, losing is apart of the game.

GBP/USD Buy Setup

Ok traders we got what we were looking for on GBP/USD. Notice how price action reacted timidly towards the 200 MA and gave us a higher low as it bounced off of the support area at the 200 MA. Then had the strength to close back above the 8 MA OMG!. The buy setup on the daily is starting to show some follow through which is a good sign for our long position.

I have entered the market with my stop in 2 different areas. But if you are just now looking to enter this trade I would place my stop-loss under the previous candle. So our entry point would be at 1.58273, our stop-loss at 1.57415 and our initial target at the prior high on the daily. Stay Tuned!

Knowledge is power but applied knowledge is more powerful

Gold did explode, did you get some?

I sure hope you did because this thing has got a lot more upside potential. The monthly is triggering now as we speak and the weekly followed through on our bottoming tail from last week. I know your thinking to yourself does he have a trading crystal ball predicting these moves? The answer is yes and it can be yours for the low price of just kidding with you lol!

But with hard work, back testing, the proper money management & risk management one can become successful in the markets. But the question some traders have to ask themselves is am I applying what I know, am I executing when I am supposed to. A lot traders find themselves stuck like a dear in the head lights when it comes time to execute. And other traders throw their strategy or even their whole trading plan out the window during the heat of the moment and start trading on the fly.

It is important that you are disciplined but it is equally important that you apply what you have learned and pull the trigger when your plan calls for you to without hesitation, reservation, or fear.

Now Looking at the charts below we can see gold is gaining some momentum. So for my swing traders you can take the monthly or weekly as is with your stop below the last pivot on the weekly. But for my intraday traders and my day traders you might want to wait for a pull back on the daily as we are a bit vertical and due for a pull back. Oh I cannot forget about silver she is a beast as well. Stay tuned there is much more bullishness to come from both metals.

Bullish XAU: RingGOLD Hmm! I think my mother was on to something!!!

I am big trader of gold and a lot of other commodities mainly because of my political beliefs and knowledge on the banking system and the fiat currency that is used as a medium of exchange around the world. Another obvious reason is that it is apart of my family name. As I stated in previous Newsletters whenever I have an opportunity to go long Gold, Silver or Oil etc.. I hop on the opportunity as I believe long positions are inline with my long-term bias of gold reaching all time highs as it is a necessity in today’s society, and as central banks continue to print more and more money the result is higher gold prices in the long run. With all that being said it is obvious that price has been consolidating in an ascending triangle on our Daily gold chart. The weekly chart is very promising as we have had several bottoming tails that have formed since the beginning of May. Now we are officially above the weekly 20ma and our bias has shifted to the upside on the weekly chart. With the monthly inline with our long bias and coming off of a bottoming tail that bounced off of a rising 20ma last month. OMG look out Gold is set to explode to the upside. You heard it hear and from me and my fellow colleague Jonathan Velez first GOLD IS SET TO EXPLODE so strap on your seat belts and get ready for the ride. Stay Tuned!!!

AUD/USD Trade Update (Up 264 pips)

I can’t forget about my good ole AUD/USD long position. We are up 264 pips at the moment and still got some good size on. Our stop-loss is at break even so we are trading with the houses money at this point. I am expecting a pull back so that I can add to my position. If price action fails to pullback, gives us a shallow retracement and then decides to rally, then be mindful of the resistance at the 1.06321 level stay tuned.

S&P 500 Trade Update (The Bottoming Tail)

Do you see what I see! Things just keep getting better and better for S&P 500. I mean are you kidding me a Bottoming Tail some call it the Hammer others call it the hanging man but regardless what you choose to call it, it is the second most bullish candle in our Candle Stick Alphabet, sitting right on top of the 20 MA. Need I say more traders, we are getting blatant strength from the bulls. A bottoming tail is formed when the bears start out dominant and are able to push price down to a lower level. But before the candle closes the bulls are able to overcome the bears strength and close out the candle as the side that won the battle. If you look at the chart below you will notice how in the past four weeks every time the bears attempt to muster up some strength, before the week is out the bulls have wiped out what the bears have tried to establish and then some establishing themselves as the side that is in control. In a lot of cases doing so in less time then the bears had to establish their strength, talk about power. This is why the Bottoming Tail is one of the most powerful tools inside our Traders Toolbox that we have at our disposal.

If you notice in the chart below we are starting to get some follow through to the upside as a result of the Bottoming Tail from last week. By spotting the right candles on the right time frames you are able take advantage of certain moves and opportunities as they present themselves with the confidence of knowing you are trading in the direction of least resistance.

$&P 500 Trade Update were in the money!

Man what can I say S&P 500 has been a beast. I mean did we pick the right time to go all in or what. Our Long position and add has paid us handsomely. As stated earlier we were looking to take profit at the top of the channel as price makes its way into the prior high. We are up 600 points and counting and we still got some nice size on this position. I am looking to get light on my position at the prior high on the monthly. It is rare in trading to have a home run but I think it is safe to say we knocked this one out of the park. Stay Tuned!

On another note have you ever heard the saying strike while the irons hot, get to gettin while the gettin is good, ride the trend till the end, Milk it dry etc… Although it is best to ride the trend as long as you possibly can during any season in the markets. During the summer since good trades  and solid trends are far and few between  (except this week in the market oh boy) one has to try to take advantage of any trend you find and follow the money. That means ride the wave and add till you cannot add no more. Now of course you want to keep your risk in check, treat every trade separately even if they are on the same chart, and follow your trading plan. But if there is money staring you in the face on a particular pair or commodity then stick with that pair or commodity because if it is paying and the other pairs or charts are choppy then the instrument that is paying is the one that commands our attention. As you can see in the chart above I have played S&P in a major way as well as AUD this past month because these are the charts that commanded my attention. In directing my focus to these charts I was able to avoid the whip saw and choppiness in other pairs that would have more than likely resulted in me giving some profit back.

S&P 500 Trade Update

It looks like we are starting to get some follow through on our weekly buy setup on S&P 500. So I have added to my long position at 1369.45. I expect to see price action rally to 1414.00 with little resistance if this weeks candle can maintain itself above the weekly 20MA. The monthly chart is is also looking promising as it is inline with our weekly chart which provides further confirmation that we could get follow through to the prior high. I have my first Take Profit Level at 1413.75, at that point I will then be watching price action to see if it can break through the prior high at the 1414 level. If price fails to break the prior high then I will adjust my exit strategy accordingly. Stay Tuned!!!

Master Traders use D.O.P.E. not HOPE

There are many characteristics and skills required by traders in order for them to be successful in the financial markets. The ability to understand fundamentals and the ability to determine the direction of the trend are a few of the key traits needed, but not one of these is as important as the ability to contain emotions and maintain discipline.

Below are the 4 key traits that I feel are nessccesary for a trader to master in order to become what is referred to as a Self Actualized Trader.

Discipline
Observation
Patience
Execution

Discipline:

“Failing to prepare is preparing to fail.”

Proper preparation is required before every open. The easiest thing to do is prepare. If you don’t, on behalf of the other market participants, we thank you.

“Never mistake activity for achievement. If you don’t have time to do it right, when will you have time to do it over?”

Perfect trading practice makes perfect trading. You learn by breaking down each trade into small pieces and reviewing each piece. Develop a plan before you trade or do it later with less cash and more frustration. (Remember to Back test, Study, Back test, Study and more Back Testing etc….)

Remember money management is required on every trade. It only takes one trade to undo months of profitable trading. So always remember, that the one trade that can undo it all is always lurking around the corner. “Control your own destiny or someone else will.”

Put yourself in the best position or you will not have a position come tomorrow.

Observation:

“A man should look for what is, and not for what he thinks should be.”
Albert Einstein

A trader should look at a chart for what it is, and not for what he wants it to be. Face reality as it is, not as it was or as you wish it to be. Bend your view to the charts, not the charts to your view.

You want to be diligent in looking for other opportunities, but still mindful and conscious of what is  currently on your plate. If you are not conscious of what is on your plate you will not see what is falling off the sides. In other words you want to manage your current positions effectively with still looking for other trading opportunities.

Patience:

“Be quick but do not hurry.”
Pull the trigger when you see the trade but not before.

“Do not let what you cannot do interfere with what you can do.”

You become a better trader by being patient and waiting for the plays that make sense to you and trading more of them with more size.

There are times when you should have positions on, and times when you should look to be flat. Knowing when to trade and knowing when to be patience and sit on your hands in cash is a necessary step towards obtaining trading mastery. Remember remaining flat in cash is a position too, a big part of trading is not just making profit but retaining it as well.

Execution:

A good plan violently executed now is better than a perfect plan executed next week.
George S. Patton

A trading plan is just words until you act on it.

I was once told by a mentor of mine “He who hesitates is poor.”

So If you are thinking about getting out, your competition is already flat.

Confine yourself to the present and always do whatever’s next. ” Stay in the now moment opportunity flow”

A trade is not connected to another, unless you let it. Move on, understand what happened in the past but do not have an emotional attachment to it.

Michael Jordan is one of the greatest athletes and competitors of our time. One of his most famous quotes is “I’ve failed over and over and over again in my life and that is why I succeed.” With that being said we are what we repeatedly do. So excellence, therefore, is not an act, but a habit.

The view of trading changes after a loss it is your job to get it back to where it was. And maintain it through periods of adversity.

Traders should periodically review and assess their performance and refine their approach. This means not only should they review their bottomline and their positions, but also how they prepared for the trading session the night before, and how they’re progressing in terms of ongoing education, among other things. This periodic assessment can help the trader correct mistakes, which in return helps to enhance their overall profitabilty. It also helps to maintain the right mindset and be more psychologically prepared to execute their plan the next morning.

In closing it’s important for a trader to be able to read a chart and devolope a directional bias, but there is often a psychological component to trading that shouldn’t be overlooked. Establishing trading rules, building a trading plan, doing research and getting experience are all simple steps that can help a trader overcome these little mind matters.