Cowabunga System Daily Update: Thursday, 02/04/2010

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 :

  • 7:00am EST- UK Bank of England Interest Rate Decision
  • 8:30am EST- US Non-Farm Productivity
  • 10:00am EST- US Factory Orders

Today’s Surf

12:30am EST- There was a moving average crossover for a short trade. RSI was less than 50, MACD went from positive to negative, but stochastics were trending up. This cancelled the signal and I did not enter.

8:45am 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 1.5844 with a stop at the most recent swing high at 1.5885. Since I was 44 pips away from the nearest 50 or 00 level, I decided to put my initial target at 1.5800.

Entry: Short at 1.5844 Stop: 1.5885 Target: 1.5800

9:45am EST- My target was hit. Price made a clean break so I moved my stop to 1.5800 and set my next target for 1.5750.

11:30am EST- My 2nd target at 1.5750 was hit. Price made a clean break so I moved my stop to 1.5750 and set my next target for 1.5700.

11:45am EST- Unfortunately I got stopped out at my 2nd target at 1.5750.

entry2

Trade Result: +94 pips (NOT INCLUDING SPREAD) R-Multiple: 2.29

News events to watch for tomorrow:

  • 4:30am EST- UK PPI Input m/m
  • 8:30am EST- US Change in Non-farm Payrolls
  • 10:00am EST- US Factory Orders

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.

  • mabidashraf

    Bingo!!

  • RRR

    hi,
    just wondering when you set your target does it
    automatically close your trade at 1.580? or do you just monitor its movement and change your stops to 1.580 and target to 1.570.

  • mabidashraf

    @RRR: Mental target is set i.e. not in the trading platform, and once the mental target is hit with a clean break you set your next target and move stops to the first target. If there is no clean break of the first target, you manually close the trade. Hope that helps. Abid

  • RRR

    another question if you are just setting mental target what if the price touches 1.580 momentarily and bounces straight back up, would you then just try to close trade asap to minimise lost of profit.sorry for all the question, im a newbie and just keen to learn, and thank you for the quick reply.

  • roundrock

    RRR, I had the same doubt. How could we do that in mind ? Lot of times the price touches our target and retraces fast. Then it may not even go back and touch our target. It will help if someone gives an example and step by step explanation, this is a key part of the system

  • mabidashraf

    Bingo!!

  • RRR

    hi,
    just wondering when you set your target does it
    automatically close your trade at 1.580? or do you just monitor its movement and change your stops to 1.580 and target to 1.570.

  • mabidashraf

    @RRR: Mental target is set i.e. not in the trading platform, and once the mental target is hit with a clean break you set your next target and move stops to the first target. If there is no clean break of the first target, you manually close the trade. Hope that helps. Abid

  • RRR

    another question if you are just setting mental target what if the price touches 1.580 momentarily and bounces straight back up, would you then just try to close trade asap to minimise lost of profit.sorry for all the question, im a newbie and just keen to learn, and thank you for the quick reply.

  • PipSurfer

    @RRR & Roundrock- A good way to gauge whether or not you should exit would be to zoom in to a 5 minute chart. Use indicators to help you decide whether or not it looks like the price will continue in your favor or if it is a good time to exit. Often times you will see that when the price doesn’t make a clean break, I don’t get out right at my target. I’m usually out 5 pips off of it because obviously it is almost impossible to get out right at your mental target. Hope that helps!

  • RRR

    thanks for that makes a bit more sense now.

  • bailbondearl

    I dont know whom Im suppose to address this to, but Ive written about 4 times now with questions and none have been answered yet.
    On the Cowabunga system you have the RSI indicator added–on my Indicators it says RSI_EMA–is that the one because I have none that just say RSI.

  • PipSurfer

    @RRR & Roundrock- A good way to gauge whether or not you should exit would be to zoom in to a 5 minute chart. Use indicators to help you decide whether or not it looks like the price will continue in your favor or if it is a good time to exit. Often times you will see that when the price doesn’t make a clean break, I don’t get out right at my target. I’m usually out 5 pips off of it because obviously it is almost impossible to get out right at your mental target. Hope that helps!

  • RRR

    thanks for that makes a bit more sense now.

  • bailbondearl

    I dont know whom Im suppose to address this to, but Ive written about 4 times now with questions and none have been answered yet.
    On the Cowabunga system you have the RSI indicator added–on my Indicators it says RSI_EMA–is that the one because I have none that just say RSI.

  • mabidashraf

    @bailbondearl: I am not sure if the RSI_EMA is the same as RSI, however, if you really wanted yourself to check this, there are many free charting platforms available which will have the RSI indicator and you can check the reading on that RSI to your RSI_EMA. Hope that helps.

  • mabidashraf

    @bailbondearl: I am not sure if the RSI_EMA is the same as RSI, however, if you really wanted yourself to check this, there are many free charting platforms available which will have the RSI indicator and you can check the reading on that RSI to your RSI_EMA. Hope that helps.

  • jjt

    Hello everybody, I have been following the cowabunga system and I must confess that the system is great. But I need help on a very good broker, a broker that is genuine and real, because I have come to understand that in trading the most important element is a good broker because trading is a business and your profit must be collected. Thank you

  • jjt

    Hello everybody, I have been following the cowabunga system and I must confess that the system is great. But I need help on a very good broker, a broker that is genuine and real, because I have come to understand that in trading the most important element is a good broker because trading is a business and your profit must be collected. Thank you

  • Drifter01

    Hey Pip Surfer,

    I wanted to share with you a variation in you system that I use. I use is mostly with the Euro US cross. And it has brought my tremendous success! I, like you use the 4 hour chart to establish my current trend. However, I also use the daily to disern the strenth of that trend. Then I look for my entry points off of either the 30min or 60min. Other than that the only other diffrences are, I add the use of Bollinger Bands and my trades last for about 36 hours. In 2.5 days I netted over 320 pips!!!!!!!! Which doubled my weekly base capital. I hope others can benifit to this. There are a few minor things that I noticed, but Im on my phone typing this, and now hand cramps are setting in. Get at me N e one if you have questions.

    Good Hunting! And God bless!

  • Drifter01

    Hey Pip Surfer,

    I wanted to share with you a variation in you system that I use. I use is mostly with the Euro US cross. And it has brought my tremendous success! I, like you use the 4 hour chart to establish my current trend. However, I also use the daily to disern the strenth of that trend. Then I look for my entry points off of either the 30min or 60min. Other than that the only other diffrences are, I add the use of Bollinger Bands and my trades last for about 36 hours. In 2.5 days I netted over 320 pips!!!!!!!! Which doubled my weekly base capital. I hope others can benifit to this. There are a few minor things that I noticed, but Im on my phone typing this, and now hand cramps are setting in. Get at me N e one if you have questions.

    Good Hunting! And God bless!