“It is the mark of an instructed mind to rest satisfied with the degree of precision to which the nature of the subject admits and not to seek exactness when only an approximation of the truth is possible.”

– Aristotle

Hello:

This is an update on some of the movements on the markets and what I’m doing about them, plus my losses and profits. The analyses are based on daily charts – looking at the Big Picture. My preferred leverage is 1:100 and my position size is 0.01 lots for each $1000. The maximum risk on each trade is 1% in a situation of an initial stop. I use the Price Behavior rules for strategic decisions and my customized indicators for tactical entries. I open primary positions without predetermined exit target in mind, riding the trend for as long as it continues. The value of patience will forever be emphasized. As long as I stick to my rules and keep my risk low, I’m immune to fear.

The markets are still in indecisive situations, and therefore I’m yet to place a trade. I’d be looking for possible trades after the close of the New York Session today. The instruments I trade are more easily predictable in the middle of the week (based on my past observations).  I need to mention that this is a type of the market condition in which those who don’t use Stop Loss often go scot-free, while those who use Stop Loss look like idiots. Doing the right things don’t always make you appear smart: it simply ensures your long-term survival. What we’re looking for is trader’s participation; the more traders who are willing to buy, the stronger the buy signal. The more traders that realize they’ve made a mistake and need to exit quickly, the bigger the move in the opposite direction.

AUDUSD

Primary trend: Bullish

This pair is clearly in an uptrend. There was a false bearish breakout yesterday, so the most baffling problem is to try to find the right entry point. The previous day candlestick – a hammer, points to a potentially strong bullish continuation.

NZDUSD

Primary trend: Bullish

This pair, like AUDUSD is also trying to wind its way upwards. Like its correlating partner, it also experienced a false breakout yesterday. The price was almost breaking the trendline to the downside, and once again, one could’ve been spared if one waited for the candlestick to close below the pair, which it didn’t. There have been a series of higher lows.

EURCAD

Primary trend: Bullish

There is a strong resistance at 1.3678 and a strong support at 1.3258 (on the daily chart). For almost 3 weeks, this cross has been finding it difficult to break the aforementioned resistance and support. It would move near the resistance or go near the support; only to turn. I’ve drawn a channel to mark these two strong levels. The present situation is good for short-term traders – something I don’t do on the instrument. I’m convinced that a clear break and close above/below the channel would confirm the next market direction.

EURAUD

Primary trend: Bearish

The movement on the cross is competently flat. It’s also moving within a straight channel; the resistance on the daily chart being 1.5495, and the support 1.4298. A clear break and close below or above this would determine the next journey, either to the south or to the north. At least we aren’t prepared to catch a falling knife: we need the direction to show itself.

EURNZD

Primary trend: Bullish

The price is constantly quoted above the SMA, and the +DMI is above the –DMI. However the trend isn’t presently strong (as shown by the ADX which stands at 14) This object is moving in the opposite direction of its correlation partner, EURAUD. It’s clear that the NZD is weaker than the AUD. Yesterday, the market tried hard – with very little success – to break 1.8155 which is a very strong resistance. If this cross eventually closes above this level, then a nice journey to the upside would’ve just begun.

AUDJPY

Primary trend: Bearish

Despite the present consolidation phase of this market, the bears still appear have the bulls in subjection. This is fundamentally a trendless market; there’s a resistance at 79.40 and a support at 77.50. I can’t say what would happen next, but with a pending order, perhaps I might catch the next great move, or else I limit my losses. No-one must develop stroke, asthma or cardiac arrest while trading. We must stake low and have a good rest of mind. Why should you stake too much and risk losing too much? If the risk is too high and you’re in a losing streak, the result would be senseless sentences and childish tantrums. ‘O market, I’m on my knees. I pray you, stop moving against me!” “I can’t afford to lose more than this!” My trading career is over!” “My mother won’t accept this!” “My wife is going to kill me!”

Conclusion: If you’re right on the markets, good, and if not, you need to limit your losses. Your trading portfolios must be successfully defended on the battlefield of the financial markets. Recovery is easier only if you have smaller drawdowns. Remember the word of Ed Seykota, ‘Cutting losses, cutting losses, cutting losses.” If you can do this, you may have a chance to survive on the markets.

Please, we need more encouragement from Sam Seiden:

“Most people are afraid of failure in any part of life, especially things like trading and personal relationships. You have to understand that failure does not happen TO YOU, it happens FOR YOU. It is a gift that offers the opportunity to grow. When you shift your mind and think this way, you will smile with each failure, knowing that you have just identified a flaw that needs to be corrected, removed, or improved. Adversity is scary in the moment, but it is always when we grow the most. Failure is only permanent when you allow it to be. How wonderful adversity and failure really are.”

Your questions and opinions are highly welcome.

Thank you.

With best regards,

Azeez Mustapha

Forex Signals Strategist, Funds Manager &Coach

Email: amustapha@fxinstructor.com

NB: There is risk of loss in trading, but it is possible to be a successful trader.

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