Cowabunga System Daily Update: Thursday, 01/21/2010

The CFTC may be changing the rules for retail traders in the US. This affects many of us in a negative way and we need your help getting our voices heard.

Read more of the details

I can not find better words to describe my position on all this than those from Andrei Pehar, Chief Currency Strategist at fxKnight.com.  

Andrei says: "I am not opposed to regulation nor regulatory agencies. But that regulation needs to be fair, transparent, and open to public input. Otherwise it becomes corrupt and self-serving. Sure high leverage can get you into trouble if used thoughtlessly. Sure hedging when not done properly turns one loss into two. But I believe the cure is EDUCATION, not restricting what people can and cannot do with their investment decisions. Guide, don’t dominate – government was invented to protect people and their property, not to limit their potential.

We at BabyPips.com disagree with the CFTC proposal.

If you disagree as well, you may submit your comments to secretary@cftc.gov.  

Include “Regulation of Retail Forex” in the subject line of the message and the identification number RIN 3038-AC61 in the body of the message. Please, help us to spread the word!

I think this is a very important matter that affects us all, and we should try our hardest to ensure that things will be done for the best of the trading community.

If this is your first time visiting this blog, read this first! 

Main Trend

Current Trend

The trend stayed down the entire day.

Today I only looked for short trades.

News events to watch for today :

  • 4:30am EST- UK Public Sector Net Borrowing
  • 6:00am EST- UK CBI Industrial Order Expectations
  • 8:30am EST- US Unemployment Claims
  • 10:00am EST- US Philly Fed Index

Today’s Surf

2:15am EST- There was a moving average crossover for a short trade. RSI was less than 50, stochastics were trending down and MACD was positive and losing value. This was a valid entry.

The entry was at the close of the candle at 1.6257 with a stop at the most recent high at 1.6295. Since I was only 7 pips away from the nearest 50 or 00 level (1.6250), I decided to go for the same amount of pips I was risking on the trade, which in this case was 38. This put my initial target at 1.6219.

Entry: Short at 1.6257 Stop: 1.6295 Target: 1.6219

3:00am EST- My target was hit. Price made a clean break so I took my final profit. I exited at 1.6223.

10:45am EST- There was a moving average crossover for a short trade. RSI was less than 50, stochastics were trending down and MACD was positive and losing value. This was a valid entry.

The entry was at the close of the candle at 1.6172 with a stop at the most recent high at 1.6233. Since I was 22 pips away from the nearest 50 or 00 level, I decided to put my initial target at 1.6150.

Entry: Short at 1.6172 Stop: 1.6233 Target: 1.6150

11:00am EST- My target was hit. Price made a clean break so I moved my stop to 1.6150 and set my next target at 1.6100.

11:15am EST- Unfortunately I got stopped out at 1.6150.

entry2

Trade Result: +34 +22= +56 pips (NOT INCLUDING SPREAD) R-Multiple: 0.89; 0.36

News events to watch for tomorrow:

  • 4:30am EST- UK Retail Sales m/m

For a complete list of news events check out our Forex Economic Calendar.
Questions? Read the Cowabunga FAQ.

Want to discuss the Cowabunga System? Visit our Forex Forums.

  • daxter22

    Really quick question for any regular users of Cowabunga System. When using the 4H chart to confirm the trend are we only looking at the most recent signal change candle (i.e. crossover). Is it an issue if (as was the case today) that the trend was down but that the Stochastics were in an oversold position? before moving to consider the 15M chart for entries?
    Huge thanks

    Daxter

  • mabidashraf

    @daxter22: This is not an issue i.e. once all the conditions are true for the long or short trade, I execute the trade regardless of any reading of RSI, Stocs, or MACD.

  • daxter22

    Really quick question for any regular users of Cowabunga System. When using the 4H chart to confirm the trend are we only looking at the most recent signal change candle (i.e. crossover). Is it an issue if (as was the case today) that the trend was down but that the Stochastics were in an oversold position? before moving to consider the 15M chart for entries?
    Huge thanks

    Daxter

  • mabidashraf

    @daxter22: This is not an issue i.e. once all the conditions are true for the long or short trade, I execute the trade regardless of any reading of RSI, Stocs, or MACD.

  • daxter22

    Thanks mabidashraf. So you only care about the cross over on the 4 hour chart and its direction for trend and then move to the 15M chart for entries.

    Thanks

  • PipSurfer

    Thats correct daxter

  • daxter22

    Thanks mabidashraf. So you only care about the cross over on the 4 hour chart and its direction for trend and then move to the 15M chart for entries.

    Thanks

  • PipSurfer

    Thats correct daxter