MESSAGE FROM JACKO 429

It is 1.00am NY time Tuesday August 18 and the market is at 1.4102

The market dropped to a low of 1.4044 yesterday and has started to move back up. Those of you who are adventurous might want to buy this market 1.4100 or less. The probability of it going down much below the 1.4055 is quite low. I personally will be waiting for it to retrace to the 1.4250-1.4300 area so that I can sell it, because the 4H trend is now downwards

Edit 3.00am NY time The market is at 1.4130 This market is moving up. Again, I repeat, those of you who are adventurous may want to buy this market at the low 1.4100's.

(NOTE, I only SMS message my own trades. But I do place opinions on where the market may be heading for the more adventurous traders)

Edit 3.15am NY time Market at is at 1.4132 I decided to join the adventurous traders and have just BOUGHT at 1.4135 THIS IS A SPECULATIVE TRADE (Some of the adventurous traders are in lower than me...but I am not concerned.) I have a 100 pip Fixed SL The target is around 1.4250+

Edit 8.00am NY time Market at 1.4102 Earlier today, I was talking with some of the more adventurous traders who bought in to this market at around the 1.4100 price and decided to take a somewhat impulsive trade at 1.4135. I have a 100 pip Stop Loss and am now letting the trade play itself out.

Edit 12.15pm NY time Market at 1.4130 After a shaky start to the trade, the market is now back to where I bought and is now moving in the right direction. I am letting the trade play itself out

Emails

Email 1
I would like to comment on two of your notes. In 424 you regretted to have bought too early at 1.4140, since it was followed by a subsequent low at 1.4104. Yes In 427, you were disappointed because your 1.4350 entry point was never reached, making you miss an opportunity. It seems to me that these are two excellent opposite examples showing how difficult it is to find an optimal entry in the market. It is very difficult to pick exact tops and bottoms
My take is that most of the time there is no way to know where the market will go next. I think that the statement that no-one knows where the market is going (which some traders say), is a bit of a false statement. Most good traders can pick the general direction of where the market is heading, but picking the beginnings and endings of them is more difficult
I wonder, though, if you have a general rule of thumb to decide how or where to place your entries in a range like this one in order to miss as few trades as possible and still have the best possible entries? To be just a little beyond the S&R points to allow for the volatility (especially in the last 12 months). However that volatility is now getting lower so I will start reducing the allowance for the volatility
Talking about ranges, are you watching specific signs to guess whether the market is likely to break out of the range (as it did on the 3rd) which causes swing trades to reach their S/L or is the idea to try all trades from support to resistance and from resistance to support until one fails because the market breaks out? It was to try all trades from support to resistance and from resistance to support until one fails because the market breaks out, because this happens many more times than the breakout

Email 2
The question is: why would brokers trade against their clients only during news announcements? My hypothesis is that big brokers trade against their client whenever they can. Yes but the speed of the action in the period straight after the news allows them to play unscrupulous games like widening the spread etc, etc
During normal hours they are not strong enough to move the market. When news are about to come, the big players (banks, hedge funds) all cancel their orders or close their positions to avoid being trapped in a runaway market with huge slippage and spread, whereas private traders who ignore this fact stay in the market, becoming suddenly completely vulnerable to market manipulation by big brokers (since big brokers become the biggest player during these transient moments) Yes, Exactly you are at a HUGE disadvantage when you are trading the news

Email 3 -
first, concerning tracing support and resistance lines. As far as I understand it, your 'graph memory' is, generally speaking, 300 periods on a 4H graph. Is that correct? Yes
Then you look at the lines which touch as many extrem points as possible. Correct? Yes (what about the 12th August? It broke the support line, isn't that a case for lowering the support line?) August 12 was an "aberation ". The charts are never exact and sometimes you will see a rise or a drop that is "out of line" It is often best to ignore the abberation and connect up more points on the chart -
then, concerning Fib retracements. Can we say that on the same graph (300 periods on a 4H graph), you just take the lowest and highests points and that's it? (does it make sense to also take 50% fib retracements for the most recent swings like the one between the 12th low and the 13th high? or from older lows and highs?) I prefer to see the 50% fibs as a series of targets for a price move, So I start from the extreme right of the chart and use the series of Fib targets generated by starting on the right hand side and working to the left of the chart
- my final question is about the last sentence in your blog "I am expecting the market to bounce up from both the Support line and the 50% retracement point at around 1.4140. However, over the week, this market will go down". What makes you expect a retracement (is it the usual swing that can be expected within a range?) Yes, (though I was wrong on this... it broke through the Support Line and the market dropped like a shot duck) and what makes you expect it to go down (is it the fact that the range is ending soon and the fact that the general trend in higher units is bearish?)Yes, the USD has bottomed and is now in recovery