Cowabunga System Daily Update: Tuesday, 02/23/2010

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 up until 7am EST. From 3am – 7am EST, a new trend change candle formed and changed the trend from up to DOWN. After 7am EST, the trend remained down the rest of the day.

Today I only looked for long trades until 7am EST. After 7am EST, I only looked for short trades.

News events to watch for today :

  • 4:30am EST- UK BBA Loans for House Purchase
  • 9:00am EST- US S&P/Case-Shiller US Home Price Index
  • 10:00am EST- US Consumer Confidence

Today’s Surf

10:30am EST- There was a moving average crossover for a short trade. RSI was less than 50, stochastics were trending up and MACD was positive and losing value. This was a valid entry.

The entry was at the close of the candle at 1.5419 with a stop at the most recent swing high at 1.5450. Since I was 19 pips away from the nearest 50 or 00 level, I decided to put my initial target at 1.5400.

Entry: Short at 1.5419 Stop: 1.5450 Target: 1.5400

10:45am EST- Unfortunately I was stopped out of my trade.

entry2

Trade Result: -31 pips (NOT INCLUDING SPREAD) R-Multiple: -1.00

News events to watch for tomorrow:

  • 4:30am EST- UK Retail Sales
  • 10:30am EST- US 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.

  • gabriel888

    Hi Pip Surfer,

    I understand that the settings u use for Stochastics is (10,3,3) n’ for RSI is (9). May I know what do u mean by ‘slow and simple settings’?

    I’m currently using (14,3,5) for Stochastics n’ (14) for RSI which are the default settings for my trading platform.

    Do u think it’s advisable to continue using the default settings for these 2 indicators?

    Could u kindly advice on this? Appreciate that.

    Thanks,
    Gabriel.

  • aidanphilipson

    Hi pip surfer, hope your well. Just a quick one, i have applied the same methodology to USD/CHF and it works well, do you trade any other pairs? Great blog and thanks for the great vids.

    Aidan

  • mabidashraf

    @gabriel, In order to follow the system, I suggest using 10,3,3 for Stocs and 9 for RSI so that you get the same reading as Pipsurfer gets. Slow and simple is not applicable for all platforms so if you had these options in your platform, you go for it, if not, this does not apply to you. Regards. Abid

  • gabriel888

    Hi Pip Surfer,

    I understand that the settings u use for Stochastics is (10,3,3) n’ for RSI is (9). May I know what do u mean by ‘slow and simple settings’?

    I’m currently using (14,3,5) for Stochastics n’ (14) for RSI which are the default settings for my trading platform.

    Do u think it’s advisable to continue using the default settings for these 2 indicators?

    Could u kindly advice on this? Appreciate that.

    Thanks,
    Gabriel.

  • aidanphilipson

    Hi pip surfer, hope your well. Just a quick one, i have applied the same methodology to USD/CHF and it works well, do you trade any other pairs? Great blog and thanks for the great vids.

    Aidan

  • mabidashraf

    @gabriel, In order to follow the system, I suggest using 10,3,3 for Stocs and 9 for RSI so that you get the same reading as Pipsurfer gets. Slow and simple is not applicable for all platforms so if you had these options in your platform, you go for it, if not, this does not apply to you. Regards. Abid

  • risingPIPthunder

    Hi pipsurfer. I’m just wondering. During the day when I look at the markets. Sometimes its volatile, other times its not. There are plenty of nice trades when I’m asleep. So after watching your trades, I’m wondering what your whole trade cycle is like. As in when you get up, when your active, and when you call it a day.

  • sriloba

    Hi pipsurfer!

    I want just to make sure concerning the cross of stochastic in the 15 minute chart. If one of the two line of stoc is in the OB or OS area do you consider that is correct for the signal? Example : 5/10 ema is a death crossand rsi

  • sriloba

    Hi pipsurfer! I want just to make sure concerning the cross of stochastic in the 15 minute chart. If one of the two line of stoc is in the OB or OS area do you consider that is correct for the signal? Example : 5/10 ema is a death crossand rsi

  • sriloba

    Hi pipsurfer! I want just to make sure concerning the cross of stochastic in the 15 minute chart. If one of the two line of stoc is in the OB or OS area do you consider that is correct for the signal? Example : 5/10 ema is a death crossand rsi below 50, sto cross down but one of the two line of stoc is in the OS area and macd histo is positive and losing value. Is the signal confirmed ?

  • PipSurfer

    @gabriel- Mabidashraf is correct in his answer.

    @aidan- I only trade this on the GBP/USD because I’ve thoroughly tested it myself. However I have heard of others having success on other pairs. The only way to know for sure is to test it for yourself :)

    @risingpipthunder- 12 midnight to 12 noon EST is the time range that best suits the system. If you are in the US that means pulling some all-nighters. I like to watch the market live but some people use alerts to let them know when a possible signal is about to take place.

    @sriloba- As long as stochastics makes the correct cross then it doesn’t matter if it is on OB or OS territory.

    Hope that helps! Happy trading everyone!

  • risingPIPthunder

    Hi pipsurfer. I’m just wondering. During the day when I look at the markets. Sometimes its volatile, other times its not. There are plenty of nice trades when I’m asleep. So after watching your trades, I’m wondering what your whole trade cycle is like. As in when you get up, when your active, and when you call it a day.

  • sriloba

    Hi pipsurfer!

    I want just to make sure concerning the cross of stochastic in the 15 minute chart. If one of the two line of stoc is in the OB or OS area do you consider that is correct for the signal? Example : 5/10 ema is a death crossand rsi
    Is the signal is confirmed ?

    Thanks

  • sriloba

    Hi pipsurfer! I want just to make sure concerning the cross of stochastic in the 15 minute chart. If one of the two line of stoc is in the OB or OS area do you consider that is correct for the signal? Example : 5/10 ema is a death crossand rsi

    Thanks

  • sriloba

    Hi pipsurfer! I want just to make sure concerning the cross of stochastic in the 15 minute chart. If one of the two line of stoc is in the OB or OS area do you consider that is correct for the signal? Example : 5/10 ema is a death crossand rsi below 50, sto cross down but one of the two line of stoc is in the OS area and macd histo is positive and losing value. Is the signal confirmed ?

  • PipSurfer

    @gabriel- Mabidashraf is correct in his answer.

    @aidan- I only trade this on the GBP/USD because I’ve thoroughly tested it myself. However I have heard of others having success on other pairs. The only way to know for sure is to test it for yourself :)

    @risingpipthunder- 12 midnight to 12 noon EST is the time range that best suits the system. If you are in the US that means pulling some all-nighters. I like to watch the market live but some people use alerts to let them know when a possible signal is about to take place.

    @sriloba- As long as stochastics makes the correct cross then it doesn’t matter if it is on OB or OS territory.

    Hope that helps! Happy trading everyone!