MESSAGE FROM JACKO 512

It is 3.00am NY time Friday December 18 and the market is at 1.4385

As stated yesterday, my sense of frustration and impatience with this market was very high. I can see what it was doing (dropping) , I can see my missed entry point (1.4900), I can see that I was rational in not chasing the market, I can see where I think it will pullback to (1.4700+), and I can see that it is going to take days to get there.
So it is with some sense of pleasure that I am watching the market (hopefully) start to climb off its low at 1.4304 and head up to an area where it will be in the sell zone.
I get the feeling that we are going to have an active Christmas period as the market reacts to critical news (like the recent downgrading of Greece's credit rating...and the impact on the rest of the EU community) in the thin markets.

Edit 8.00am NY time Market is at 1.4340 The state of play is that we know that the trend has changed. The market has made its first move down (to 1.4300) since the break of the Daily Support/Resistance line at 1.4900. We are now waiting for a significant pullback from that drop, so that we can place some long term Sells.

Edit 12.05pm NY time Market is at 1.4281 The pullback I have been waiting on is seriously overdue.

Edit 7.00pm NY time Market is closed. The market has fallen very quickly since it broke the 1.4900 Support line just 10 trading days ago. I expect that the next 10 trading days will see some serious pullback on that fall. I will be watching the market over the Christmas period to capitalize on any pull back and establish some long term shorts for the 2010 year. I believe that the trend has now changed and that we will see a sustained long term increase in the USD ( a fall in the Euro) over the next 12 months. I also think that a target of 1.2500 is highly possible for 2010.
Given the huge volatility impact caused by the Great Financial Crisis over the last 15 months, we have traded reasonably well this year. (The recent failure to get set with a sell at the target of 1.4900.... which we missed by just 10 pips...was a very sad miss. However, it is only 10 days worth of missed trading opportunity and the market will recover some of that drop very soon). I believe that this strengthening of the USD is in its very early stages and that 2010 will be an excellent year.


MESSAGE FROM JACKO 511

It is 3.00am NY time Thursday December 17 and the market is at 1.4400

After staying up all night in the hope that the FOMC announcement would give a nice bump up in the Euro, so that we could sell it, I have woken to find that the major move happened in our local Asian trading time zone. This is easily the quietest period of the day for the Euro so it is obviously serious Asian (China??!!) buying of USDs. There has been a quick move down in the Euro on the strengthening USD.
Looking on the bright side, the only thing worse than not being in the market.... is being in the market the wrong way. (Anyone in US or European timezones with overnight long positions have all just been stopped out, I would think)
I am concerned that we may be seeing a repeat of the strong USD buying that occurred at from 08/08/2008. (It was the start of the Beijing Games). It is worth going back and having a read of the blog from that time!!
The risk of loss from jumping in at this time is waaaay too high. I want a significant pullback. This is the type of market action where everyone starts to say that this drop in the market will go forever....Then it snaps back!!!

Edit 8.00am NY time Market is at 1.4355. On the basis of the depth of this drop in the market I am looking to reduce my target sell price from the 1.4900 area to maybe as low as the 1.4700 area, but will be watching the price action between now and when it moves back up.
As I said some days ago, the trend has certainly changed, so it is now just a case of getting in at a position that has minimal risk of loss attached to it. Once we are in the market, we can then start to compound our positions using the markets money. The main rule isDo not lose money.

Edit 12.10pm NY time Market is at 1.4310 As much as I want to jump into the feeding frenzy of buying the USD and taking a short term short on the Euro, I have decided to stay on the sidelines.

Edit 7.00pm NY time Market is at 1.4341 My sense of frustration and impatience with this market very high. I can see what it is doing, I can see my missed entry point (1.4900), I can see that I was rational in not chasing the market, I can see where I think it will pullback to (1.4700+), and I can see that it is going to take days to get there.
Having said that, with the benefit of perfect hindsight, it is easy to see that a better course of action would have been to throw caution to the wind and, as soon as the Daily Support/Resistance line was broken at 1.4900, to just sell it and keep on selling. (Some of you did).
But that is the advantage of hindsight..it over-rides and negates the emotions and thinking that you had at the time when the action was done.





MESSAGE FROM JACKO 510

It is 3.00am NY time Wednesday December 16 and the market is at 1.4520

As stated yesterday,I am now looking for a sizable pullback so that I can establish some long term short positions. One of the advantagesof trading the Daily charts is that they are more predictable. Thedisadvantage is that if you miss a trade entry, you have to wait a while to get the next opportunity. (I missed my sell trade entry of 1.4900 by only 10 pips when the market went to 1.4890 on Dec 7...a very sad miss !!!).
I never like to "chase" a trade if I miss it, I prefer to get the next trade set-up instead. So I am now waiting for a decent sized pullback to get the next wave down.

Looking at the Daily chart, you can see that it is extremely rare for the market to have a 500 pip move without a subsequent 200+ pip retracement move. Patience is required. But it will be well worth it. We are in the very early stages of a new bear market for the Euro (or more correctly, a new Bull market for the USD)

Edit 8.00am NY time Market is at 1.4565 The market has started to move back up after hitting a low of 1.4503. We may have seen the start of the retracement of the move from 1.5000 to 1.4500.

Edit12.10pm NY time Market is at 1.4570 The market has been choppy today with no real direction, but the price action looks biased to the up side.

Edit 7.00pm NY time Market is at 1.4525. The market had its usual quick fluctuation up and down with the FOMC announcement but then settled back to where it was prior to the announcement. The market has basically flatlined since then. The market is still stubbornly stuck in the mid to low 1.4500 area.

Emails (see Message 507)



MESSAGE FROM JACKO 509

It is 3.00am NY time Tuesday December 15 and the market is at 1.4614

The market has remained flat since the start of the week but is showing some weakness heading into the London open.
The market position has not changed from Message 506. That is, I am certain that the trend has changed. I am looking forward to getting set in some serious long term short positions over the next couple of weeks. If you look at 20001, 2002, 2004 and 2006 you will see that the December/January period is a time of major reversals. I think that 2009 will join that list.
I have seen a lot of similarities with this current market, and how it is behaving, to the turn in 2006. Those of you who have read the history of my trading will know that the turn of the market in 2006 was the start of my massive growth in Forex. 
I really think that this current market turn will be a repeat of the same. 
BUT, one thing that the forex market does with great consistancy is to move up and down in the range. I can also see the market moving back once or twice (to around 1.4900-1.4950) to shake out the weaker players. Then it will progressively drop lower and lower but before it does, there will be some good opportunities ahead to get some big short positions established.
If you look at a Daily chart, it is easy to see that 1.4900 is a very likely target for the market to move towards.
Also, if you look at the weekly chart, you can see the potential of this move down (sub 1.3000??). Now that we are back trading on the Dailies those are the moves I want. And compounding up the lot sizes as we go.
I believe that the USD has started its fight back. The US economy has been ground down since mid February and is starting to show faint signs of recovery. And as I have said before, the US economy is still the most powerful economic engine in the world.
I am still a SELLER at 1.4900. 

Edit 8.00am NY time Market is at 1.4535 The market has moved lower in London trading. Not being in the market at the moment is annoying, but the risk of selling without waiting for a pullback is taking an unreasonable risk. The market almost always has pullbacks. I don't think that this one will be different.

Edit 12.10pm NY time Market is at 1.4514. I am watching for a pullback of any decent size to sell into this market.

Edit 7.00pm NY time Market is at 1.4542 A disappointing day today. I am now looking for a sizable pullback so that I can establish some long term short positions. One of the advantages of the Daily charts is that they are more predictable. The disadvantage is that if you miss a trade entry, you have to wait a while to get the next opportunity. (I missed my sell trade entry of 1.4900 by only 10 pips when the market went to 1.4890 on Dec 7...a very sad miss !!!).
I never like to "chase" a trade if I miss it, I prefer to get the next set up instead. So I am now waiting for a decent sized pullback to get the next wave down


MESSAGE FROM JACKO 508

It is 3.00am NY time Monday December 14 and the market is at 1.4675

The market position has not changed from Message 506. I am still a SELLER at 1.4900
I am about to go into a meeting. I will be back for the US session 

Edit 9.00am NY time Market is at 1.4640 Apologies for the delay. As stated last week, I am (51%) certain that the trend has changed. I am looking forward to getting set in some serious long term short positions over the next couple of weeks. I can also see the market moving back once or twice to shake out the weaker players. Then it will progressively drop lower and lower but before it does, there will be some good opportunities ahead to get some big short positions established. But I am just waiting for a suitable pullback to higher levels to establish some short positions

Edit 12.05pm NY time Market is at 1.4645. I am feeling very confident about the market in the next couple of months. I am seeing a lot of similarities with this current market, and how it is behaving, to the turn in 2006. Those of you who have read the history of my trading will know that the turn of the market in 2006 was the start of my massive growth in Forex. I really think that this current market turn will be a repeat of the same. 
I am waiting for a pullback up to around the 1.4900 area (the 50% fib from 1.5140 to 1.4586).

Edit 7.00pm NY time Market is at 1.4654. The market was very dull in afternoon trading today with minimal movement




MESSAGE FROM JACKO 507

It is 3.00am NY time Friday December 11 and the market is at 1.4725

The market position has not changed from Message 506. I am still a SELLER at 1.4900

Edit 8.00am NY time Market is at 1.4766 The market has been as high as 1.4775 so we have see the expected gradual move back up in the direction towards 1.4900. I am still a seller at 1.4900.

For the adventurous traders: You should be in at 1.4700 (as per yesterday's recommendation) If you are not in by now, it is too late.The market at the current level does not warrant the risk of going long at the current level

Edit 12.10pm NY time Market at 1.4610 Market is weaker than I expected. This wil need a review of entry target next week.


Edit 4.00pm NY time Market is closed. I seriously underestimated the move down in the morning session today. The market is now a bear market. After looking at the Daily (and Weekly) chart I can see that there is a long way for this to move down over the next 12 (?) months but I now have to wait for a pullback to get into a position. I will be taking short positions aggressively from now on.


IMPORTANT: On a personal note, I usually do not trade over the period leading up to Christmas and New Year. However I believe that this period will be an important and critical time in the change of trend for the market. So I intend to continue to trade and post the blog during that time.
However, a major time commitment is the time spent on answering emails. Mrs Jackson has asked (demanded !!) that I compromise by agreeing to not answer any emails over that period so that we can have at least some time to ourselves.
My staff (except one part time admin staff) have been given their vacation time during this period.
So as of the close of business today, I will be continuing to post my trades and send the SMSes and update the blog, but I will not be answering emails until after the Christmas and New Year period. I will answer emails again from January 4, 2010.




MESSAGE FROM JACKO 506

It is 3.00am NY time Thursday December 10 and the market is at 1.4710

As discussed a couple of days ago, I am (51%) certain that the trend has changed. I am looking forward to getting set in some serious long term short positions over the next couple of weeks. If you look at 20001, 2002, 2004 and 2006 you will see that the December/January period is a time of major reversals. I think that 2009 will join that list.
I have seen a lot of similarities with this current market, and how it is behaving, to the turn in 2006. Those of you who have read the history of my trading will know that the turn of the market in 2006 was the start of my massive growth in Forex. I really think that this current market turn will be a repeat of the same. 
BUT, one thing that the forex market does with great consistancy is to move up and down in the range. I can also see the market moving back once or twice (to around 1.4900-1.4950) to shake out the weaker players. Then it will progressively drop lower and lower but before it does, there will be some good opportunities ahead to get some big short positions established.
If you look at a Daily chart, it is easy to see that 1.4900 is a very likely target for the market to move towards.
Also, if you look at the weekly chart, you can see the potential of this move down (sub 1.3000??). Now that we are back trading on the Dailies those are the moves I want. And compounding up the lot sizes as we go.
I believe that the USD has started its fight back. The US economy has been ground down since mid February and is starting to show faint signs of recovery. And as I have said before, the US economy is still the most powerful economic engine in the world.

For the adventurous traders: I believe that the market is sitting close to its short term bottom at the 1.4700 mark. The market may drop below it so wait until it has turned and is heading back up so as not to catch a falling knife. As outlined above, I think the market will try to climb up towards the 1.4900 mark, so there is a "risky" 200 pips on offer. Its not for me, but if you are adventurous, the probabilities of going long (to 1.4900) is much better than going short at the current levels. (Save the shorts until the market is at better prices).

Edit 8.00am NY time. Market is at 1.4732. The market has dropped to as low as 1.4685 and has now risen to its current price. There are no US news events today.
I am still a seller at 1.4900

Edit 12.10pm NY time Market is at 1.4717 A slow day on the market so far in the US session. Maybe the afternoon session will show some decent activity

Edit 7.00pm NY time Market is at 1.4730. A very slow day on the US markets today. However, everything written above (especially for theadventurous traders) still applies.




MESSAGE FROM JACKO 505

It is 3.00am NY time Wednesday December 9 and the market

Wayne has a migraine and is currently sleeping. He will be back tomorrow

Mark

Edit 6.15pm NY time I am back!! After a near 16 hour solid sleep (with the weirdest dreams !!!) I am back and feeling much better. The market has done little in my absence so I don't feel as though I have missed any real action. I will be back for the London open tomorrow

MESSAGE FROM JACKO 504 

It is 3.00am NY time Tuesday December 8 and the market is at 1.4810 

The market got to within 10 pips of my target with a high of 1.4890.... I am leaving my Sell order there for the moment as I think we may get another bite from our fish. I am still a Seller at 1.4900

Edit 8.00am NY time Market is at 1.4790 The market has moved away marginally from my Sell order, but one thing that the forex market does with great consistancy is to move up and down in the range. And if you look at a Daily chart, it is easy to see that 1.4900 is a very likely target the market to move towards.
Again there is no real news events in the US today, so the market has no drivers of price this morning.
I am still a Seller at 1.4900

Edit 12.05pm NY time Market is at 1.4736 I have returned from a dinner function hoping that the market had moved up and maybe triggered my sell, so I was disappointed to see that it had fallen a little further. I was hoping to snare the 1.4900 fish today. As discussed on previous occasions, the market often turns around in the US afternoon session. 
I think ( only 51% certain) that the trend has changed. I am looking forward to getting set in some long term short positions over the next couple of weeks. If you look at 20001, 2002, 2004
and 2006 you will see that the December/January period is a time of major reversals. I think that 2009 will join that list.
But as I have said above, I can see the market moving back once or twice before it does, so there are some good opportunities ahead to get some big short positions established. (If you look at the weekly chart, you can see the potential of this move down). Now that we are back trading on the Dailies those are the moves I want.

Edit 7.30pm NY time Market is at 1.4705 The previous trade opportunity when I wanted to sell at 1.4900 but the market only went to 1.4890 is now looking a sad miss. I missed that entry by only 10 pips.

Emails

Email 1
I read an article earlier this week and would like to know what your thoughts are on the matter. It noted that there seems to be a trend lately where the London session is having more influence on the Eur/Usd movement; that the NY market seems to follow the London lead. (This has been the case for 5 market days in a row -- possible more scattered.) Hmmm Yes, but the US news has far more impact than any Euro news
It went on to mention on the fact that 'everyone' is selling the dollar and getting away from it looking for a stronger currency. Not any more ......
I'd guess we're a good distance away from the dollar not being the world currency, but there is a lot of chatter on the streets. Also, I've read that the trading volume of the London Forex Market is nearly double now what's traded during the NY session. Not sure about that source. I think that is is getting close because of the reduction in the size of US hedge funds that got killed in the GFC. 

Email 2
The market has taken a fall but I think that it will go up more. What do you think? I believe that the trend may have changed. ......I have been leery of the Euro Bull since early November when the higher highs were only marginally higher each time. I think that the trend has changed (but only 51% certain) and I am looking forward to getting set in some long term short positions over the next couple of weeks. Having said that I fully expect that there will be opportunities to get back into this market at 1.5000 again in the next 2-3 weeks. This will not be a precipitous drop all the way down. This market will come back but I would be surprised to see it break its previous highs

Email 3
i was wondering about the outcome of NF employment. The result of -11k vs forcasted -119k showed a suprising difference. Now i would think that good news for the dollar would actually weaken the dollar because that is how it's been since the financial crisis and the safe heaven search. How do you know that this sentiment has changed or how should one understand it :) No, the market fundamentals are now coming back to reality...That the US economy is still the best economic engine in the world and that lower job loses means that it is picking up strength
did you expected this to happen ? when news is good the dollar rises ?From now on, I think so... 



MESSAGE FROM JACKO 503

It is 3.00am NY time Monday December 7 and the market is at 1.4873

The USD has finally shown some strength on the back of Fridays NFP numbers. The Support line on Friday at 1.4870 was broken when the market dropped as low as 1.4821. This break was a (convincing?) 50 pip break of the line. (It barely made the set 50 pip limit) The market has been moving back up to that line (now at 1.4900 approx) in the last 10 hours since the markets re-opened

I have my charts open to 300 periods of the Daily time frame.
The Resistance line. At the present time there is no descending Resistance line of interest. In regards to horizontal Resistance lines, the Resistance is now at the previous high of 1.5144.
The Support line is found by linking up the lowest points on the Daily chart starting from 1.2460 (March 3) and 1.2886 (April21) and and 1.4628 (Nov 26) we can see that the old rising Support line is today at around 1.4900 (rounded up slightly).
The 50% Fib line between 1.4626 (Nov 2) and the new high of 1.5144(Nov 24) was at 1.4885. That 50% Fib has already been broken when the market fell to 1.4828 on Nov 26) , so we then looked further back to the previous low of 1.4480 (Oct 1) and the latest high of 1.5144 (Nov 24) to calculate the next 50% Fib target ...which was 1.4812.. The market fell on Friday to 1.4821 which was close enough.

In light of the above we have two conflicting signals. The primary one is that it has broken the Daily trend line by 50 pips (...barely). The second, and conflicting signal, is that it has bounced off the 50% Fib line.
I am looking to see which signal proves to be the stronger. (My guess is to the short side as a Trend line break trumps a 50% fib line bounce).
The news calendar is remarkably clear of major US news events until the US Trade Balance numbers on Thursday Dec 10.
I am more interested in watching how the US market treats this market today, rather than London. I think New York will give us a better indication of the medium term direction.

Edit 8.00am NY time Market is at 1.4798 The trend line did trump the 50% fib line when the market dropped to 1.4757 breaking the 50% fib line. The market has now clearly broken the Daily trend line. This market will bounce back up and confirm the drop with a touch of the old Support line at 1.4900 which will now act as Resistance. I will be a Seller at 1.4900 (or higher, if I can get it)

Edit12.10pm NY time Market is at 1.4812 The US`market has been surprisingly quiet. I was expecting a much more active market after Fridays move and the London earlier session. Maybe the afternoon session will pick up the pace.

Edit 12.50pm NY time Market has moved up quickly on Ben Bernankes speech in Washington. Still ongoing...
I am a Seller at 1.4900 

Edit 7.00pm NY time The market got to within 10 pips of my target with a high of 1.4890.... I am leaving it there for the moment as I think we may get another bite from our fish.

Emails
I am a little slow on the emails from Friday...Mrs Jackson caught me on the computer on the weekend and went ballistic ...so I will catch up the emails in the next 24 hours

MESSAGE FROM JACKO 502

It is 3.00am NY time Friday December 4 and the market is at 1.5085

The market has continued to move aimlessly around with no real direction. It has spent most of this week moving within plus or minus 50 pips from the infamous 1.5095 mark (where I was stopped out on he last trade). I have been looking for a sense of direction from the market but at the moment there is none.
Today, we have the major news events of the US Non Farm Payrolls (NFP) and US Unemployment Rate at 8.30am NY time. The NFP is one of the biggest market movers on the calendar. The FOMC announcement is the other major market mover.
Unless you have a very large cushion of profit, it is always recommended that you stay out of the market during NFP because of the big swings, and the huge increases in spreads, which combine to just rip up all the Stop losses. It is when the brokers make some serious money at the expense of traders.

Will be back at 8.45am NY time after the NFP announcement

Edit 8.45pm NY time Market is at 1.4990 The NFP has come in at -11K vs the expected -120K and has caused the USD to strengthen. The market has dropped to 1.4990. This will change market sentiment in the short term and cause the market to fall further next week.

The adventurous traders. I would NOT be closing the shorts from 1.5070 or higher at these levels... this will go lower

Edit 12.10pm NY time Market is at 1.4889 Market has dropped to the Support line. As I don't want to be holding a position over the weekend, I will be a taking a position very early next week.


Emails

Email 1
Given the daily bar increment against the support line, is 1,4850 now not too low for a long entry as this falls below the support line? Yes, the rising Support line increases in value each day... The market has moved up past 1.4850
So what would the new entry level be or how would you calculate it?
OK.. How to draw a Support Line and determine todays Support line price
The simplest way is to go to the free charts at DailyFX.com or Netdania.com (they are the same)
Pull up the EUR/USD chart
1. To get 300 Days of data:
Click on Time Scale.....Set it to Daily
Click on View
Click on Periods.......Set it to 300 bars
You now have 300 days worth of Daily bars

2. To draw the lines:
Click on Lines
Click on Add lines
Click on Freehand
Click on the low point of 1.2460 on march 3 and draw the line touching all the low points ending with 1.4828 on Nov 26

3. To get a magnified chart:
Now click on Zoom
Click on Zoom IN
Highlight the last (approx) 50 bars and you will see a magnified copy of the last (approx) 50 days with the 300 bar Daily Support line clearly seen

4. To get the Support line price
Drop a line down from todays price bar down to the Support line and read the value off the right hand price axis....
You will have the rising Support line price for today.

The Resistance line is drawn in similar manner






MESSAGE FROM JACKO 501

It is 3.00am NY time Thursday December 3 and the market is at 1.5115

The market has now gyrated 60 pips below the 1.5095 level and now is 30 pips above it, so there is not a lot of movement in the range around that level since Tuesday morning NY time.

I am still on the sidelines, looking for an opportunity to get a reasonable risk trade.
My preference is to wait until it gets back to the Support line but IF I see an opportunity before that, then I will be interested in trading it.
At the moment the market is trading at 1.5115 which it has traded at on today, yesterday and the day before that. It has been at this 1.5115 mark each day for three consecutive days. This market is not showing a great deal of strong direction in the last three days.

Edit 8.00am NY time Market is at 1.5125. The market has moved very little so far today. The earlier ECB announcement that interest rates would remain at 1.00% had almost no impact on the market. The other news events today are the US Unemployment Claim numbers at 8.30am and the US ISM Non -Manufacturing PMI numbers at 10.00am. I am still looking for a trade opportunity.

Edit 12.30pm NY time Market is at 1.5078 After rapid spikes down and up at 8.36am caused by a speech by Mr Geithner, and also another by the ECB's Mr Trichet, the market has been slowly moving down this morning. I am on the sidelines at the moment.

Edit 7.00pm NY time Market is at 1.5062 This market is aimlessly looking for a direction at the present time. I too am looking to see which way it will head. A frustrating market at the present time.




MESSAGE FROM JACKO 500

(Can you believe that !!!!! ...500 days of Blog entries )


It is 3.00am NY time Wednesday December 2 and the market is at 1.5086

The safest trade is to wait out the market until it moves back to the Support line at 1.4850 and buy on the pullback.

But I am a trader and I am feeling adventurous and I believe the probabilities in the next 24 hours are shifting to the sell side. The market has stayed in the region of where I was stopped out (1.5095). I am seriously tempted to get back into this market. I am waiting to make sure that it is not a revenge trade. It believe that this market may correct back to the 1.4850 Support line again very soon.
(NOTE : Please read emails below)

For the adventurous traders: I still believe that a Sell at the level of 1.5070 or higher is a better probability trade than a buy at those levels

Edit 8.00am NY time Market is at 1.5084 I have decided to stay on the sidelines for a while longer while I watch the market. It is still trading in the area of where I was stopped out on my last trade (1.5095). The US ADP Non Farm Employment Change news is released at 8.15am today and it is always a market mover.

Edit 12.10pm NY time Market is at 1.5053 The market has dropped marginally on rumours that a large US bank has more undisclosed losses. But otherwise a tame morning of trading

Edit 7.00pmNY time Market is at 1.5076 The market has moved down as low as 1.5031, and has now just bounced back up to 1.5076. This is too high a level for me to be a buyer, so I have two options: firstly, to stay on the sidelines until the market gets back to the Support line OR secondly, to take the "riskier" trade of selling down to the Support line.
I am currently waiting on the sidelines BUT IF I see an interesting possibility to sell down, I may take it...because I am a trader.



Emails

Email 1
You have had two losses in a row. Yes, thanks for telling me that.
As I have said before, I am not a signal service. ...My trades and trade notifications are not a recommendation. They are simply to allow you to see when and what I am trading and why.

But keep in mind, I have NEVER had a negative Quarter. I have never even come close to having a negative Quarter. And I fully expect this Quarter to be another positive Quarter.

What were your reasons for taking a trade that was not in the Up direction of the Trend? In this last trade, I was very specific when I said: "It is a more risky trade so feel free not to take it" The reasons I took that more risky trade was
(i) driven by my annoyance at missing the buy entry last Friday,
(ii) my keen desire to trade, and
(iii) most importantly, my expectation that the market would stay within the trading range of the Support line (1.4825) and the upper area where it had been ranging at 1.5000.

Email 2
Why didn't you wait until it had dropped back to the Support line again ? I had been on the sidelines for an extended period as I waited for the market only to see it rapidly drop and bounce back up 30 minutes before London opened as I was working on the blog. (To say I was annoyed at missing that trade is an understatement !!!!!)
I therefore had two options: firstly to wait until it again dropped to the Support line again OR secondly, trade the range of 1.4825 to 1.5000. I decided to trade the range based on the expectation that the 1.5000 area of resistance would be strong enough to hold. (That was where I was wrong!!)
You have to remember that I am first and foremost a TRADER! I will sometimes take a trade that is beyond the parameters of Trend Trading if I think that the situation justifies it.
But I will always forewarn each of you by stating that it is a more risky trade, and give the reasons why I am trading it.






MESSAGE FROM JACKO 499

It is 3.00am NY time Tuesday December 1 and the market is at 1.5024

My current Short trade from 1.4995 is still in play. It has a fixed 100 pips Stop Loss set at 1.5095 and my initial target price is at the rising Support line at 1.4850. I am letting the trade play itself out

Edit 8.00am NY time Market is at 1.5064 The market has been sitting in a 100 pip range (from 1.4980 -1.5080) all week. The major news events for the day are the US ISM Manuufacturing PMI and the US Pending Home Sales at 10.00am today. I am continuing to let my trade play itself out.

For adventurous traders: If you are not already in a trade, I would be a Seller at these high 1.5070 levels

Edit 12.10pm NY time Market is at 1.5106 My trade was stopped out at 1.5095 earler today as the market continued it move up. I will now wait for the correction back to the Support line for the next trade entry.

Edit 7.00pm NY time Market is at 1.5090. In reviewing the last trade, a number of issues stand out. One is that I was looking to trade the range rather than the trend and secondly I used 1.5000 as the considered high of the range. Both assumptions were incorrect. But as always, the damage was limited to a maximum of 2% of capital, so the damage is easily repaired. I am looking to recoup those losses in the next trade.

MESSAGE FROM JACKO 498

It is 3.00am NY time Monday November 30 and the market 1.5061

My trade from yesterday did not have the best of entry points. It was driven by my annoyance at missing the buy entry last Friday, my keen desire to trade, and my expectation that the market would stay within the trading range of the Support line (1.4825) and the upper area where it had been ranging at 1.5000 (therefore the Sell at 1.4995).
As outlined, it was a more risky trade. However, I decided to take the risk. I am now letting the trade play itself out.

Edit 8.00am NY time Market is at 1.5028 My trade is still playing itself out.
As an entry point, my Sell at 1.4995 was a shocker.!!! It was terrible !!! Even Mrs Jackson says she could have done better than that.... LOL
The only justification is that, at the time, I thought 1.5000 was going to be a much stronger Resistance area than it was. However, the trade is still alive and playing itself out.

I have my charts open to 300 periods of the Daily time frame.
The Resistance line. At the present time there is no descending Resistance line of interest. In regards to horizontal Resistance lines, the Resistance is now at the previous high of 1.5144. At the present time, that Resistance is of little use to us as the 100 pip fixed Stop Loss at 1.5095 has more relevance in the current trade. (If the market goes up, the Stop Loss will close the trade)
The Support line is found by linking up the lowest points on the Daily chart starting from 1.2460 (March 3) and 1.2886 (April21) and and the new low of 1.4628 (Nov 26) we can see that the rising Support line is today at 1.4835 (and rounded to1.4850).
The 50% Fib line between 1.4626 (Nov 2) and the new high of 1.5144(Nov 24) is now at 1.4885. This 50% Fib has already been broken when the market fell to 1.4828, so we can now look further back to the previous low of 1.4480 (Oct 1) and the latest high of 1.5144 (Nov 24) to calculate the next 50% Fib target ...which is 1.4812

In light of the above, my initial target price for the current trade is the Support line at 1.4850.

Edit 12.10pm NY time Market is at 1.4986 My trade has finally moved into profit. I am letting the trade play itself out.

Edit 7.00pm NY time Market is at 1.5032.. I am continuing to let this trade play itself out


MESSAGE FROM JACKO 497 (Special Sunday post)

It is 5.30pm NY time Sunday November 29 and the market 1.5011

It is very early (6.30m HK time). The market is very thin as only Sydney is trading. Tokyo starts in 30 minutes and Hong Kong an hour later. The USD has dropped back on news that the United Arab Emirates' central bank eased liquidity for lenders and said it "stands behind" the country's local and foreign banks as they face losses from Dubai World's possible default.

I will be back in an hour after I have looked into all the news about this Dubai issue. But I am keen to trade this down to the Support line.

Edit 7.00pm NY time The market is at 1.5000 I am a Seller at 1.5000 or higher with a 100 pip fixed SL... Aaah , Hong Kong has just dropped it down.

Edit 7.45pm NY time. I have just sold at 1.4995. I decided that 1.5000 might act as a barrier. And 1.4995 was close enough



MESSAGE FROM JACKO 497

It is 3.00am NY time Friday November 27 and the market 1.4860

After rising to as high as 1.5144 the market has fallen quickly and sharply due to the very thin markets and the "flight to safety of the USD" on news that Dubai World, the largest Corporate entity in Dubai, has asked for a "standstill" on its debts until May 30 at the earliest.. (Standard & Poor's estimated Dubai World could be responsible for as much as 50% of Dubai's total government- and corporate-debt load of some $80 billion to $90 billion).

The fact that the Dubai Government hasn't completely guaranteed Dubai World is a worry.
The fact that the UAE (of which Dubai is a member state) hasn't guaranteed the debts is a bigger worry
It looks as though the Great Financial Crisis is starting to show cracks in other places again.....

On the other side, the market is quickly moving down to my rising Support line at 1.4800 (and is today at 1.4825). However, most US bankers and dealers will again be away today for an extended Thanksgiving break, so the market will be very thin with very limited liquidity. This Dubai issue will continue over the weekend. So be wary of having any open positions over the weekend. I will be opening a trade on Sunday evening NY time after the Dubai issue is clearer.


Edit 3.01am NY time Market has actually just bounced off the Support line at 1.4827 and is moving back up...But this will go lower... This Dubai issue is a serious issue that is concerning the Arab states and they will flee to the USD

Edit 8.00am NY time Ouch. Earlier today the market moved down so quickly to hit the Support line and then bounced up so quickly that I was caught unawares. I was actually writing the blog entry leading up to 3.00am as the market was dropping like a rock and was not watching the screen. (When I started drafting the blog the market was at 1.4920) It hit 1.4827 and bounced back up to 1.4860 while I was drafting the blog and had the computer on the blog page. That will teach me to be down at the coffee shop below the office and only have the one laptop with me.Ouch.

Edit 12.10pm NY time Market is at 1.4968 I am still annoyed that the market dropped so quickly to my Support line and bounced while I was drafting the blog and I missed it. I am annoyed with myself that I didn't already have the order in place to buy at my Support line. Lesson learned... Start re-using pending orders.


Edit 7.00pm NY time Market is closed. The market is back sitting in the range area between 1.4800 and 1.5000 that it has been in since Oct 12. I am really annoyed that the market made its major move in the 30 minutes before London opened and I was caught with my pants down by drafting the blog without checking the charts.
The implications of the Dubai World "standstill" on their debt has yet to be fully recognised by the larger Banking traders who were all on Thanksgiving Holiday. If Dubai defaults, which I think it will, it will be the largest sovereign default since Argentina in 2002. That gives us a very good opportunity. It will cause a further flow back to USD.
I will be placing a trade on Sunday. I would prefer to wait until the market drops back to the Support line to buy BUT I am keen to make up for the missed opportunity yesterday.

I see an opportunity to sell this market at 1.5000 (or higher) and ride it down. It is a more risky trade so feel free not to take it if you wish to be more safe. I will send SMSes on Sunday evening after the market has opened and again as I execute the trade




MESSAGE FROM JACKO 496

It is 3.00am NY time Thursday November 26 and the market 1.5091

The US market will be closed today for Thanksgiving Day, so there will be low liquidity and possible high volatility. Even though I am frustrated with the market and very keen to trade, I won't be trading today.

To each of you and your families, Mrs Jackson and I wish you all:

Happy Thanksgiving Day

In this industry we have many reasons to give Thanks for everything that has been given to us.

Firstly, I give Thanks for finding this extraordinary forex trading business where there is incredible flexibility in establishing, running and financing the business.
Given the huge leverage in this business, anyone can enter the industry and establish a trade... and commence their their subsequent business.
Also, while running the business, if I see an opportunity I can be involved within 30 seconds. More importantly, if I am in a trade and I feel that I have made a mmmmmistake I can be out of that transaction within 30 seconds. (try doing that with any other business!!)
Also, the leverage and compounding allows extraordinary growth and profits. In just two short years I managed to escalate from 2 standard contracts (with one broker) to 200 standard contracts (over 4 brokers) in a normal transaction,... and with the Fund I am now trading even bigger numbers.

Secondly, I give Thanks for a market that trends so regularly that opportunities are around every corner. Even though I have missed an opportunity or two in the last two or three years, I can remain confident because I know that there are plenty more opportunities to come.

Thirdly, I give Thanks for the fact that I can conduct my business from anywhere in the world with just my laptop and an international cell phone.

Fourthly, I give Thanks for being able to "think out" the Anti-Hedge strategy which turned my initial losers into winners and escalated my win rate

Fifthly, I give Thanks for having some excellent resources (in the form of books about earlier successful traders) which have been a beacon in those times when I have been sitting on the sidelines, wanting to rush in. Those resources have all emphasized the waiting as a precondition for becoming a winner.

Sixthly, I give Thanks to each of you for being part of this new tribe of traders that have decided to join with me in this lifelong business of trading. Also, some of you have also been more aggressive in your trading than me and I have been happy to read that many of you have made excellent profits, We have all embarked on a journey that, God willing, will allow us to have a simple yet profitable business for the rest of our lives. (For any of you who think that retirement is good, let me tell you something .... playing golf every day is boring ...and the people who do play golf every day are even more boring!!!!) I am old...and getting older...but I still get an adrenalin buzz from a successful trade

Seventhly, I give thanks for Forex Factory, without which I would never have met any of you. In my communications with each of you to date, you have ALL shown that you want to be serious and committed traders, and are willing to learn. Some of you will always be more aggressive in your willingness to take positions and some of you will be more safety-conscious. There is no right or wrong way, as long as your profits are maximized AND any losses are minimized. I think that a number of you are potentially better traders than me. If I can just help show you how I trade, I hope that many of you will use my experience and style and modify it to suit your own personalities. You can then go on to have as rewarding a time as I have had in this business. I, personally, am enjoying the group dynamics and hope that the group goes on for years as we all get to know each other and start to share our trading experiences in the near future.

Happy Thankgiving Day