Cowabunga System Daily Update: Tuesday, 02/09/2010

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 Total Trade Balance
  • 10:00am EST- US Wholesale Inventories

Today’s Surf

3:30am EST- There was a moving average crossover for a short trade. RSI was less than 50, stochastics were trending down, but MACD was already negative from the previous candle. This cancelled out the signal and I did not enter.

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 1.5608 with a stop at the most recent swing high at 1.5649. Since I was only 8 pips away from the nearest 50 or 00 level (1.5600), I decided to go for the same amount of pips I was risking on the trade, which in this case was 41. This put my initial target at 1.5567.

Entry: Short at 1.5608 Stop: 1.5649 Target: 1.5567

11:30am EST- Unfortunately I was stopped out of my trade.

entry2

Trade Result: -41 pips (NOT INCLUDING SPREAD) R-Multiple: -1.00

News events to watch for tomorrow:

  • 4:30am EST- UK Manufacturing Production
  • 5:30am EST- UK Bank of England Quarterly Inflation Report
  • 8:30am EST- US Trade Balance
  • 10:00am EST- US DOE U.S. Crude Oil Inventories

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.

  • Phepi

    hello team babypips.com, this is very good place for forex, i happy to find this pages, here are all info what most people are searching about fx, from education to pips making system with awsome review and video. thank you all for so good site! keep working on this good luck
    best regard phepi

  • Phepi

    hello team babypips.com, this is very good place for forex, i happy to find this pages, here are all info what most people are searching about fx, from education to pips making system with awsome review and video. thank you all for so good site! keep working on this good luck
    best regard phepi

  • cds4686

    Hi Pipsurfer,

    If I use the Cowabunga system on the 1 hr time frame, instead of 15 min., what time frame should I check for the trend? Still 4 hr? or the daily chart?
    And would the rule – of waiting til the close of the signal candle to enter the trade – be the same for the 1 hr chart?

    Thanks!

  • moultan

    Hi pipsurfer great work mate..

    Im a little confused about your 4hr settings, do the stochastics and RSI have to be right b4 its a main trend change. ie even though your moving averages cross, RSI must be above 50 and stochs heading up for a long trade.

    What happens if lines cross but the rest line up later say maybe 4 candles later??

  • cds4686

    Hi Pipsurfer,

    If I use the Cowabunga system on the 1 hr time frame, instead of 15 min., what time frame should I check for the trend? Still 4 hr? or the daily chart?
    And would the rule – of waiting til the close of the signal candle to enter the trade – be the same for the 1 hr chart?

    Thanks!

  • moultan

    Hi pipsurfer great work mate..

    Im a little confused about your 4hr settings, do the stochastics and RSI have to be right b4 its a main trend change. ie even though your moving averages cross, RSI must be above 50 and stochs heading up for a long trade.

    What happens if lines cross but the rest line up later say maybe 4 candles later??

  • PipSurfer

    @cds- If you use a 1 hr chart, I would at least use a daily chart for your long term chart. Keep in mind, that this system has only been proven to work with the 15 minute and 4hr chart so make sure you thoroughly test your strategy before going live!

    @moultan- The indicators only need to line up on the same candle as the trend change candle. After a trend change candle is made, the trend stays in that direction, regardless of what the indicators do. Only when a new trend change candle is formed, do you start taking trades in the opposite direction.

    Hope that helps! Happy trading!

  • PipSurfer

    @cds- If you use a 1 hr chart, I would at least use a daily chart for your long term chart. Keep in mind, that this system has only been proven to work with the 15 minute and 4hr chart so make sure you thoroughly test your strategy before going live!

    @moultan- The indicators only need to line up on the same candle as the trend change candle. After a trend change candle is made, the trend stays in that direction, regardless of what the indicators do. Only when a new trend change candle is formed, do you start taking trades in the opposite direction.

    Hope that helps! Happy trading!