MESSAGE FROM JACKO 447

It is 1.00am NY time Friday September 11 and the market is at 1.4612

The situation hasn't changed from yesterday. I am not prepared to risk a short trade against such strength at the present time. I will wait for a significant retracement and then go long. This has been a week to be very cautious. That quick 105 pip drop from1.4608 to 1.4503 yesterday stung a few longs

Edit 3.05am NY time Market is at 1.4602 The market is struggling to get clear of the 1.4600 area. It has been as high as 1.4627. However, some of the more adventurous traders in the group are placing short positions around 1.4600 and are now being filled. The probabilities are favourable to them.

Edit 8.00am NY time Market is at 1.4608 This market is still staying near the 1.4600 area. but the high over the last four hours has been only as high as 1.4615. The more adventurous traders are staying with their shorts. The longer that the market doesn't rise above 1.4615 and/or 1.4627, the probabilities are becoming more favourable to them.
I am currently still on the sidelines.

Edit 12.15pm NY time Market is at 1.4586. The market has continued to stay around the 1.4600 area. The market is due for a correction to this rise and when it does correct, it could go as far south as the old Resistance -turned-Support at the 1.4400 area

Emails

Email 1
What caused the market to jump to such high levels? Combination of :
Increase in Gold price (some people saw that as a move away from USD to Gold, so Gold goes up and USD goes down),
Good European (esp German) factory orders numbers;
Mr Roubini saying that the USD is going to collapse ; and
Mr Greenspan saying that inflation will hit double digits in the US in the next two years

Can you please explain to me how you pick out your probabilities? Just experience and measuring it over the years
I saw you use percentages could you please let me know all of the probabilities you look out for?
75% bounces off S&R lines..... 25% break through
60% bounces off 50% fib line ...40 % break through (therefore 50% Fib lines are not as strong as S&R lines)
50% of the times, the market will come back to the broken Support or Resistance line for confirmation touch

Email 2
through my years of learning, i have never figured out how the interest rates affect the market. So if BoE decides to raise rates, does that make GBP go up or down? If a country increases its interest rates , that means investors with cash deposits earn more..so investors will send money to that country....means that they will buy more of that currency ...means that the price of that currency will be bid up...means that that currency goes up.
what about if they decide not to cut/raise rates? If they decide to cut rates it goes in the opposite...Investors take their money out of that countries banks ...sell the currency (and take it else where) ..so currency will go down
or if they decide to cut rates, is GBP gonna move up or down? If UK interest rates are going up the GBP will go up..If UK is lowering rates...GBP will fall
and how will this impact eur/usd? UK is seen as a proxy for the euro...If UK is going to increase rates, then euro MAY do the same (because UK is a sizable part of European trade).
Having said that, you should keep in mind that forex traders are forward looking....so they have usually been pricing in an interest rate rise/fall outcome for weeks before the actual Rate decision is formally announced..so you will often have a "Buy the rumour and Sell the fact" reaction at the announcement

Email 3
It appears to me that the resistance line on this chart will remain upwards unless we get a series of lower highs. Yes...and we are starting to see some of them coming out out now...But the other ( more favored ) option is to move out to a higher time frame to get a stronger line
But we cannot remain cautious for ever LOL. I assume that if you believe we are in an uptrend then not seeing an upward sloping resistance would make you cautious Yes...no market goes up forever without running out of sellers (as all the novices pile in thinking they have found the Holy Grail) ... then it quickly spikes... and collapses!!!!!! (and the novices are left wondering what big truck had just run over them)

Email 4
We had some easy pips in august, I was increasing the lots in play, and I was more confident. What's happened as next you can imagine.......... Hmmmm...yes !!
I'm not going to tell you the % I was trading, otherwise you'll cancell my name from your group. LOL!!!!!!!! but I played with "casino money" and I lost "only " the august's money :((((((( Not very good,I know Ouch..
I'm reading a William O'Neil's book and he talks about some initial loss as the "tuition to pay to the market" Yes,,.. we all remember our losses far more strongly than our wins.... I can still remember a futures market trade when I burned almost $200K in one day on futures trading some 15 years ago...(Mrs Jackson was NOT pleased,... but hen she told me that she still loved me!!) Nowadays $200K is small potatoes, BUT I still vividly remember that day...LOL
I thought that the bottom was falling out of my world...... Because the world was certainly falling out of my bottom !!!...LOL
I'm reading again your blog and you were increasing your lots in play very fast as well, you went from 2 lots to 20 in short time...... so I wanted to do it also...... Ok...So now you start again and you have learnt something… and you have only "lost" a month in your plan