Cowabunga System Daily Update: Wednesday, 09/01/2010

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 was down the entire day.

Today I only looked for short trades.

News events to watch for today :

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. Even if it was a valid signal, I still wouldn’t enter because it was right before a news event.

4:15am 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. Even if it was a valid signal, I still wouldn’t enter because it was right before a news event.

entry2

Trade Result: +0 Pips R-Multiple: N/A

News events to watch for Thursday:

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.

  • yashim

    Good day. I am a new person in the forex business and seems to have problems on how to trade successfully. Though I am still on the demo account and I am not finding things easy.

    Please direct me on how to trade successfully.

    My area of weakness are:

    (1) At which stage can enter the market, that is what are the signals to watch?
    (2) What are short or long term trading?
    Please help me, i want to trade forex for a living. This is my email address – kazzahawan@rocketmail.com.

    Thanks greatly.

    AWAN

  • yashim

    Good day. I am a new person in the forex business and seems to have problems on how to trade successfully. Though I am still on the demo account and I am not finding things easy.

    Please direct me on how to trade successfully.

    My area of weakness are:

    (1) At which stage can enter the market, that is what are the signals to watch?
    (2) What are short or long term trading?
    Please help me, i want to trade forex for a living. This is my email address – kazzahawan@rocketmail.com.

    Thanks greatly.

    AWAN

  • PHTrader

    Thank you for the answer the other day regarding risk managment for Cowabunga. I have one follow up question I would appreciate if you could explain for me. I have seen your track at the online tracker as you guided me towards. The only think is that it states the pips won, but will that tell you if you are profitalble or not. Let me explain what I mean by that. If you risk 1% on every trade you are risking the same with 40 pips stop loss or 10 pips stoploss. If you take a looser with like 40 pips you loose 1%, but if you profit on 20 pips at same setup you only gain 0,5%. If you not use fixed percentage and use fixed amount that I guess will make it even worse. I will underline I am not challenging you in any way with the question about the system. I am just very interested in your system and want to understand :-) Hope you can give me some help here :-)

  • PHTrader

    Yashim.
    Please look at the very well explained rules on this system before ask a general question that can be anwered in the system explenation. Then you can use the author of the system for getting more input if something is not clear for you. The execution of the system is very straight forward for even a beginner. It is very good you are interested, but the forum and blog will develop faster if we all take responsibilty to check most of info as possible with given info before start using other persons time. Based on the questions you ask I think you should take the school at this site. I started there when I first started with trading some years ago and it made my progress and understanding for trading move to a very good level. Good luck buddy :-)

  • PHTrader

    Thank you for the answer the other day regarding risk managment for Cowabunga. I have one follow up question I would appreciate if you could explain for me. I have seen your track at the online tracker as you guided me towards. The only think is that it states the pips won, but will that tell you if you are profitalble or not. Let me explain what I mean by that. If you risk 1% on every trade you are risking the same with 40 pips stop loss or 10 pips stoploss. If you take a looser with like 40 pips you loose 1%, but if you profit on 20 pips at same setup you only gain 0,5%. If you not use fixed percentage and use fixed amount that I guess will make it even worse. I will underline I am not challenging you in any way with the question about the system. I am just very interested in your system and want to understand :-) Hope you can give me some help here :-)

  • PHTrader

    Yashim.
    Please look at the very well explained rules on this system before ask a general question that can be anwered in the system explenation. Then you can use the author of the system for getting more input if something is not clear for you. The execution of the system is very straight forward for even a beginner. It is very good you are interested, but the forum and blog will develop faster if we all take responsibilty to check most of info as possible with given info before start using other persons time. Based on the questions you ask I think you should take the school at this site. I started there when I first started with trading some years ago and it made my progress and understanding for trading move to a very good level. Good luck buddy :-)

  • PipSurfer

    @PHtrader- Good question indeed. Let me try my best to explain it. When you use a % amount of your capital for each trade and keep it the same every time (whether its .05%, 1%, or even 2%), then the same rule will apply regarding the R-multiple. The rule I’m referring to is that if your R-multiple is less than 1 then you will have to win a higher percentage of trades. Vice versa, if your R-multiple is greater than 1 then you can afford to win a lower percentage of trades. As long as you use the same fixed % on each trade then this rule should always hold true. With your example above, lets say you lose 40 pips..that is 1% of your account but if you won it would only be 20 pips…. which is .05% of your account. Doesn’t look like it would be profitable in the long run right? However what if you won 3 times as many times as you loss? Those small wins now counter your few losses and you still end up with a profit. Does that make sense? Happy trading!

  • PipSurfer

    @PHtrader- Good question indeed. Let me try my best to explain it. When you use a % amount of your capital for each trade and keep it the same every time (whether its .05%, 1%, or even 2%), then the same rule will apply regarding the R-multiple. The rule I’m referring to is that if your R-multiple is less than 1 then you will have to win a higher percentage of trades. Vice versa, if your R-multiple is greater than 1 then you can afford to win a lower percentage of trades. As long as you use the same fixed % on each trade then this rule should always hold true. With your example above, lets say you lose 40 pips..that is 1% of your account but if you won it would only be 20 pips…. which is .05% of your account. Doesn’t look like it would be profitable in the long run right? However what if you won 3 times as many times as you loss? Those small wins now counter your few losses and you still end up with a profit. Does that make sense? Happy trading!

  • PHTrader

    PipSurfer.
    Thank you for your time and patience to explain your way of thinking and the foundation of your Risk Management. Your explanation makes sense thank you. That is of cource under the meaning of having a good system as your system obviously is since you and many fellow traders stick to it. I am a professional trader myself, but are mostly trading the longer trades but are looking for a system that can do some more high frequency trading like Cowabonga represents. I have a special relationship to this site and your system as that is the first system I got to know when I first started in the business. It is like the first girlfriend you have when you are young. You never seem to be able to forget it and it always represent something good. The only “question” I have had with it has been the RR, but I think I will start with it with a more limited lot of the short term trading account and add on as I monitor the results :-) Thanks again for the site and your very honorable job you do for the many starting up in FX Trading – and the ones been involved for some time :-)

    Best wishes for the future trading.

  • PHTrader

    PipSurfer.
    Thank you for your time and patience to explain your way of thinking and the foundation of your Risk Management. Your explanation makes sense thank you. That is of cource under the meaning of having a good system as your system obviously is since you and many fellow traders stick to it. I am a professional trader myself, but are mostly trading the longer trades but are looking for a system that can do some more high frequency trading like Cowabonga represents. I have a special relationship to this site and your system as that is the first system I got to know when I first started in the business. It is like the first girlfriend you have when you are young. You never seem to be able to forget it and it always represent something good. The only “question” I have had with it has been the RR, but I think I will start with it with a more limited lot of the short term trading account and add on as I monitor the results :-) Thanks again for the site and your very honorable job you do for the many starting up in FX Trading – and the ones been involved for some time :-)

    Best wishes for the future trading.