MESSAGE FROM JACKO 424

It is 1.00am NY time Tuesday August 11 and the market is at 1.4131

My buy was executed at 1.4140 yesterday. I have bought at a price above where I wanted, because I "thought" that the US afternoon session might turn it around. So when I saw signs of it heading back towards the 1.4150 mark at 12.00pm, I decided to buy it at 1.4140 in case it did not go any lower.

As it turned out, the market went close to my target of 1.4100 at the low of 14104. ( I should have been more patient...LOL). I am now letting the trade play itself out

Edit 3.00am NY time Market is at 1.4155. Good morning Europe. I am still letting my trade play itself out. I am trading off the Support line at 1.4100 (actual BUY at 1.4140) with the expectation that it will head back up towards the Resistance line at 1.4338 (rounded to 1.4300).

Edit 8.00am NY time Market at 1.4167. Good morning USA. I am still letting my trade play itself out.

Edit 12.10pm NY time Market at 1.4142 . I am still letting my trade play itself out


Emails

Email 1
I would like to know what made you confident that the market will come down to 4300 level. Any reason? When a market moves out along the chart like it did last week, it usually means that the momentum of the previous direction (which was UP) is losing power..and therefore will go in the opposite direction (that is DOWN)
Email 2
I am just curious while you haven't gone short at all this week (last week) and close at a goal of 1.4338 or 1.4300? I try to only take the A+ trades for myself and more importantly, for the Fund. However, some of the more adventurous traders like to trade more and want to know where I think the market may be going, so I try to give some guidance.
Email 3
My question is: what criteria would make you feel that the market is tightening up for a strong up movement? The range getting progressively smaller over the time period...last week the range was remarkably consistent
Email 4
What should I look for if I want to trade the reversals of each session. Firstly, I think that if you try to trade it every day, you will have only mediocre results..but if you watch it and are very selective on which days it shows strong characteristics, it is a very viable short term method"
Hmmm...I am trying to formulate what I look for...probably the steepness of the rise/fall preceding the 30 minutes before the change of session...the steeper / faster the fall, the more likely that it will reverse as the newer session traders believe that the rise/fall is overdone..and the PROBABILITY of a further extension of that rise/fall gets smaller
Email 5
Firstly from my understanding there are talks of the reccession now being over so with todays jobs report we can see more confirmation of that as fewer people are losing jobs, but why are people buying the dollar. Is that not the currency that people have been running to for safe haven in unsure times ? I don't believe that the safe haven issue is that important at the moment. I believe that we are seeing the "heavy hand" of China again, just like we did a year ago. One thing that the US based media is NOT talking about is the fact that China has gained control of the USD....They are talking about safe havens/ risky assets etc etc etc but NOT the China issue. Being an American "on the outside" now, I can see that the US media either can't see it OR don't want to talk about it

Does the the Dow have anything to do with this ? As investors from overseas invest in the Dow stocks it will increase the strength of the USD, but all the Sovereign Funds are nursing big losses on their purchases last year especially the investements in the big US banks. They are now changing their focuses to the BRIC countries (Brazil, Russia, India and China)

Do you watch any other instruments for indication on euro direction e.g (dollar index) ? No...I can see it just by looking at the Eur/USD

I've been struggling with the idea of 100pip stops as I believe that using such a large stop loss means your entry is wrong. Also there isn't always more than 100pips available on a move. Thats why I have been moving to using a target price rather than using TSL's
So is it ok now to use 50pip stops ? They will get whipsawed out in the current market
And when the market finally turns then you can get in again if you've been stopped out? Yes, you can do that, but you will be trading in much shorter time frames than I want to trade.

Do you believe in risk to reward ratios ? No...I know the risk (that is the SL) but the reward is a complete unknown..so it is mental masturbation based on believing that you can state BEFORE the trade is placed where it will go and where you will close the trade..and what do you achieve?

As a trader, Is it ok to use 100pip stops and be satified with trades of 50-70pips profit ? (Might this be because you will get more right) Yes, provided you are not closing them out prematurely. If you are closing them out at close to optimum profit, then it is a good trade. But if you are closing them only because they have hit 50-70 pips profit with no intention of letting any profits run, then you are trading incorrectly