Food for thought

First some thing totally nothing to do with trading. I was invited to an asian friends wedding the weekend just gone and having lost a very dear frd the week before as well as receive two other  very bad peieces of news a lady frds baby dying and frds dad diagnosed with cancer I can tell you I needed a pick up.

I have to say it was one of the moist wonderful experiences I have ever seen and to see the bride and groom so revered in thier regalia it was a sight to behold and a real pick me up to see the other emotional extreme to sadness which is pure Joy, I wish them both a very long anf happy marraige.

 

Now you may be thinking has he lost his marbles well in fact its the emotional extremes I just mentioned that are so prevalent in our lives that will kill us in our trading if they are not controlled.

You know I have spoken about the extreme volatilty going on at the moment and many will be feeling they are missing out not being in the markets my answer to that is this, these are times when the only thing you shud be thinking abt is being very risk averse wait for clear clean aset ups as always pare back your size and most of be patient and control your emotions. I advocate that you control the need and impulse to be in the markets unless your criteria for a trade is fully met, apart from the fact of the bad news events keeping me out, as sad as they were they were extremely timely in svaing me from getting chopped to pieces in the market.

There is a spiritual saying that I heard many years ago and it is “everything is as it should be” that simple but ever so powerful if you just relax and calm down you may be late for an appointment or a trade alert you may miss a frds birthday or a bus or train to work, but my feelings are nature has a way of making every moment of our lifes at the precise time just as it should be.

Meaning in my case I needed to be away from the markets, to focus my thoughts and energies into people who needed me  and my time at that precise moment to be there for them a gift far greater than any winning trade it was atime for reflection to stand bank and know that you may miss a trade or too but in the big scheme of things there will always be another along, trades are continuously transisent as our lives friends and family are in this world one of these has a value of montary worth the other has a value that cannot be measured in money at all.

So the message is the next time you feel the need to be in the market again and again and again STOP THINK AND say to YOURSELF relax be patient everything is just as it should be there is something else going on that hasnt become clear yet be patient and it will.

that is why nature and harmonics are so ingrained in each other and should like everything on this planet revered for all it is.

 

Take care of all you value in life and even more so of the thngs you havent valued thus far.

 

HTEngland

 

I am away this weekend shark fishing so will be away until tuesday next week if I dont post before then apologies I have ntg to report or say  if I have any new trade feelings or alerts they will be sent out all I am doing is watching and waiting as the only trade on the rader is the SP area at 1217 which has been repelled at the 1214 area 3 times now other than that I am doing nothing.

Regret a wasted emotion/Harmonics and why we should value them

Many times in the past from students, friends, and present day students, fellow traders and mere chance meetings you get asked all sorts of funny questions about this job, However the same question that seems to always come up from fellow traders, and students new to Harmonics is how do you deal with situations when you have the right position on get stopped out only to see the market reverse and produce the move you were expecting to catch.

I will answer this in two parts the reason for this is very recently I had posted four position trades 3 got stopped and then moved slightly further then reversed as I expected but I was not on the move that transpired, in pariticular was a EUR/CHF trade that made a substantial move after stopping me out.

Now the regret part there is none for me these days and I will tell you why, many many times before I discovered harmonics I was still pretty clued up and had a very accurate trading style but my main issue was stopping out postions. I had the same fear that we all go through I did not want to lose money, so stupidly and wrongly thought the best way to avoid this was never put a stop in, I can tell you for a while I would get away with swings against me where technically I should have been out the market period, and positioned the other way, but no my psychology was such,  I would tell myself know im right im holding it, and many times my positions would come back, and I would make good profit.

 So whats the problem well all my energy was so taken up with praying the postion would come back that many hours were wasted doing nothing but tick watching, and many good trade opportunites were missed because of this rubbish trade that I should not be in.

My final nail was the day I was short sps and I went to the toilet literally 1 min I came back had no stop in, and found myself down $12000  because the fed had just cut interest rates. From that day forward I vowed to sort my trading plan out find a better way to make trades count, and most importantly know where the stops should be where the market was inexplicably telling me i am wrong and should be out the position.

So back to EUR/CHF the position was intitated and stopped the area was both technically feasable and Harmonic it also had trendlines and other little things I work into my trading signals. However the market told me that it wanted to squeeze higher than where I was in, by some 180 points my stop was 60 points so I got stopped. The market then reversed and dropped some 800 points hitting all of the targets I had for my initial trade.

Was I upset no, my work now is very clear. find clear areas of harmonic support and reistance within the context of the bigger picture play with the predominant trend and find technically feasable trades with tight stops to me 60 points is tight.

I know people who use 200 and they work for banks some use 20 points but to me thats scalping. 6o points is more than enough room for a harmonic pattern to work if it doesnt it normally signifies something bigger is happening.

Now the second part of the answer as to why there is no regret.

Harmonics gives you something that many strategies or methodlogies do not it gives you price patterns it gives you areas of buy and sell interest and it gives you technical structure whereby you can very easily know when you are wrong and thereby place a stop without it being challenged by the stop run brigade before reversing.

Now sometimes as in EUR/CHF you have situations where the market squeezes you out and then reverses but if you ever get sucked into thinking the way forward is dont put a stop in and hope it comes back I am telling you from personal experience it is wrong. There will be and is the case when harmonic patterns are broken and the market just continues to run and run and you will get crushed but what first happens is you take a risk and get away with it you do it again and again survive. The market is very clever at setting you up you then continue to renforce in your psycholgy as I did in the past that doing the wrong thing not having a stop in place is ok when in fact it certainly is not. We have stops for protection and they over the long haul serve their purpose you will always have the situation when you had it in the wrong place or to tight thats life we are human and we make mistakes.

However even if you do have your stop in the wrong place,  your job is to evaluate yourself and learn from them, and work to eradicate them and thats takes work and blunt honesty, but in the long run stops will protect and serve you very well. I never ever enter a position without a stop and I always know where it will be before the trade is placed if I am wrong then I am wrong and the market is telling me my analysis was wrong on this occasion but I am confident that over the long run, and the structure of my work means I get it right far more time than I get it wrong so I do not worry about the odd anomly trade where volatilty kick s me out of a position and then shows me I was right in my veiw, its not personal the market does not care or know me it just does what it does and the sooner you understand that the better and more rewarding your trading will become.

Harmonics gives you structure so on the whole when patterns get broken they mean something nothing is 100pct but if your fee the need to check go read all my blogs and you will clearly see that my posts are in the 75 % plus accuracy of being right and thats down to playing with the market not against it trying to impose my will on it, and using harmonics in the correct manner  the saying the trend is your friend is simple but so misunderstood it means play with it dont try to be clever and go against it the simple thing about trading is you either let the market show you what its doing listen to it and trade accordingly or dont and be a loser plain and simple.

Our job as traders is to make money plain and simple but the money is not what you should be focusing on our job is to trade well, in doing that it requires dedication to learning your methodlogy properly understanding the risks you take and knowing what you are playing implementing it with the odds as much in your favour as you can get and refinsing your entry and exit techniques everything that you want to do well takes practise the more you work at it the better you get it cannot be any other way and those small improvements make a huge improvement to your bottom line.

The by product of trading well from a well defined trading plan with precise signals and entry and exit techniques and a clear management style will produce good earnings the things you should all be focusing on is how you trade, are you ok to trade are feeling well are you doing your work and most importantly are you being honest with yourself trust me your bottom line figures cannot lie if your losing money then something is not quite right, does it mean it cant be fixed? no it means change something stop doing what you have always done and expect different results it will not happen thats what idiots do.

Change and evaluate and implement learn from fellow traders do not follow them learn from them if you feel you have something you want to learn from them, do not get sucked in by so called experts we all get things wrong no one and I repeat no one is infallable its a fallacy, but what sets apart good traders from bad is when things go wrong good traders take a step back they dont chase markets, when they feel unwell they dont trade when they are tired they take a break when they are wrong they analyse the data to find out why, they dont sit there cursing the market and blaming all but themselves for their demise trading is about  being honest with yourself first before anything to do with the work, if you cant be honest with you doesnt matter how good your trading is when you hit a tough spot you will crumble and the ego will kill you, your job is learn evaluate implement, and continue to evolve and learn and refine this job is never about staying rigid be open to everything but be calculated in your changes never be impulsive always know why your changing something and throwing something out and putting something new in know where it fits into your plans and your trading.

This is the best job in the world I WOULD never want to do anything else I have my vocation, and as challenging as it is its not a patch on life itself, which is why you should never take a loss to heart you will always take far bigger losses in your life, but never truly realise it yet a monetary loss will stay with you forever as long as you trade, if this sounds familar then trust me your focus is on money and not trading, change it before it catches up with you.

Always remeber no matter how good you think you are or your analysis is the market always knows better it pays to respect it at all times not just when its being good to you.

I will post the two charts of EURO/CHF my sell signal and what happend after you learn most or should learn most from your losses not your winners.

One last thing to remember we are not predictors of the market we merely trade high probability set ups that put the odds of what we think may happen based on the information at hand that offers good reward for the risk we take. That is why you should never take losses personally we do the work and as you can see from these charts the markets are very volatile and you just never know when a central bank may step in and blow every technical and fundamental reason apart with intervention of their currency we just dont know so we continue to use stops for just that reason.

Happy trading

HTEngland

Apology

I am sorry for the lack of posting this week I was away last weekend due to the US holiday to have a well earned break.

I got back to work Tuesday to then hear some terrible news of a dear friend dying, so I really have taken very little interest in the markets other than the position iniated in silver which was covered, and an alert sent out. I genuinely have not been in the frame of mind to write anything of value given this news shock but assure you full service will be resumed this weekend.

 

Best Wishes

 

HTEngland

 

 

revisit a chart example of a pattern test

Last week I sent out a chart pattern alert for a sell in the sp at 1132 -1134

with a stop at 1138 T1  was 1119 that was hit it got as low as 1115.5 then moved higher so would have made a nice profit on one piece and at the very worst broke even on your second piece if you were watching the market would have got profit on the second piece lower than initial entry however not at 1106 for t2.

Now why am I mentioning this and why am I posting the example, the reason is I want to clarify on this particular example why you would have been right to sell the first test of the pattern but not the second. The reason is a frd who receives my mail sold the 2nd test not realising the first test had been and gone thereby making the 2nd test a holdback until the market proves its solid there again but when you have no idea of what I look for on a entry how can you know and that would result in selling blind into a pattern that I personally would not do after the first test.

so please make a note when you get any alert and look at the chart try and make sure the pattern hasnt already been hit by the time you go to place the trade yourself so this mistake does not happen to you, as you are aware once the markets open on a sunday night patterns can be hit overnight the next day even 3 to 4 days past as in the case of EURO STG posted 2 weeks ago T2 was jst shy on friday and I am sure will be hit on the reopen.

anyway look at these charts the before and after scenario as you know all my analysis is done before the markets has opened so there is no reason to miss any trigger if you put orders in wth stops and limits but thats a choice you hv to make. Please read the text on chart to see clarification of what I think about the price action

 

until I post again happy trading

 

HTENGLAND

 

 

Quick recap from last weeks charts

Due to major volatility I have been playing very restrictive participation in the markets waiting for the correct set ups.

Last week I sent charts out to the direct group I send signals ahead of time watching patterns set up for the week ahead.

The charts will be posted on here but just in case you do not believe that harmonics can help you yeild great profits even in markets as whippy and what appear to be insane moves your wrong you just have to be prepared to wait for them to come to you when you do you get rewarded with great results.

At present I still think we are moving lower on the markets as this movew in my opinion is in the big sceme of things just getting started but it will not be a straight down affair which is why you have stop losses and in these times lower your trading size, not widen your stops as so  many think to account for voaltilty you drop size down and place stops in technically feasible areas if you dont know what they are then you should not be in the market period because your gambling not trading.

hear are the charts from my direct email group this is what I gave out ahead of time check the markets to see what happend and then tell me harmonics do not play even in volatile markets making clear sennse out of what appears chaotic market swings.

I have only showed 3 of the four signals given the other was a loss of 50 points on euro I havent ommitted it to be deceitful but given trade the signals alone has yielded some 1000 plus pips last week of profit its dwarfed in relation but I have told you for info anyway.

 

Have a gd week

 

HTENGLAND

 

notice to everyone

I will not always post on here with my live set ups so if you wish to be added to my live analysis group where I send trade set ups before tthey happen then please contact me on here and I will add your email address to the group I send to.

 

Best wishes

 

HTEngland

 

knowing when to step aside.

I just wanted to talk a little about what has gone on in the markets this week with regard to the debt crisis, and how we as traders should be approaching things. I would first state these are my personal opinions and you do not have to agree with me I am just talking about how I approach times like this.

As you may or may not know we have a severe lack of trust from a market perspective with regard to debt problems in the US AND EUROPE going on at present everyone prior to the US Congress finally agreeing a deal on the debt ceiling thought that would mean crisis over for the markets and back to normal. What people and the senators have not realised is this before they started deliberating on their morals about signing this deal and that deal only a select few really understood the magnittude of their debt burden and the potential affect on the global economy as a result of it.

Now because the debacle had taken so long now even a modest roadsweeper can give you an opinon on it now its all over the tv and tabloids resulting in scaring the wits out of ordinary people to potential bursting of the worlds biggest creditor, coupled with the markets getting extremely itchy feet regarding Italian goverment bonds as well.

What many dont realise is this just because they have agreed to raise their debt ceiling does not mean they are going to reduce that huge debt burden anytime soon, but in making a public specatacle of it the whole world meaning everyone now knows the US is in trouble if they did not already which now means that people are now waking up to the reality that even with over 3 trillion of pumped dollars into a flagging economy it is still barely on life support god only knows how bad it would have been without the stimulus.

Even though corporate profits have stedliy risen they have been helped by a multitude of factors a 35 % dive in the value of the dollar unprecedented cutbacks on balance sheets and laying off, of staff to quote a couple none the less the stock market rose whilst the real man on the street saw the continued decline of the real economy no jobs being found housing markets struggling car sales and retailers suffering. Many many small businesses going to the wall its really scary what is not being talked about is now we are turning down again, and the economy has in fact not picked up what will they do as sovereign nations have their own debt problems from years of fiscal abuse of their purse strings.

Well  I can tell you I am no mind reader I am not an economist and I am not a nobel peace prize winning economist and I am no central banker, but as limited as my knowledge is even I knew that the bear market was not and could not be resolved as quickly as the central bankers wanted you to believe.

You do not have subprime crisis like we had and some huge names disapearing forever and then huge spending of even more debt the very problem that got us here first solving the most severe fiscal crisies we have ever had bar none, and it all being resolved in 2 years markets in times like this just dont repair no matter what the central bankers and politicians will have you believe. So what is going on, well I think we are now resuming the bear market of 2007 I have a view that Nature has a very clever way of making you feel all is well and then hits you when you least expect it or want to when you are try to stop it following its natural path which has been done on numerous occasions by the know all central bankers and advisors with theri fiscal games they ahve played.

The economy in the US has not recovered it has just appeared that way with massive spending, imagine this scenario your a million pounds in debt and you go to your bank manager and say I know I am struggling to pay my debt back I have not enough assets to cover all the debt, yet my suggestion is you give me another million pounds, and I will spend my way back into profit.

Trust me not only would your bank manager laugh his socks of he would think you had been on something yet, for some reason the so called select goverments of the US, UK, AND EUROPE have tried to convince us of this very idea and that it would solve our debt crisis. WRONG its just made it so much worse subprime debt has not gone its been moved out of the public eye debt burdens have got larger just as the economy proppped up by extreme spending is starting to contract again, goverments are starting to collapse under fiscal strain and worst of all they have no more paper money to print, the US the biggest cuplrit of all has abused its staus of the world reserve currency that you now have politcal farscial senators talking about morals of serving the people about debt and reducing it. These very same senators have been signing bills to raise the debt limit for the last 25 years this hasnt just happend its been years of abuse in the making by the very people who tell you its not down to us its the opposition they did it. Even now with the european debt crisis you have the EU PARLIMENT passing a bill to raise its spending when eveyone else is cutting back it is the biggest abuse of public funds I HAVE EVER SEEN SO STILL THEY DO NOT GET THE MAGNITUDE OF WHAT HAS RESULTED FROM THEIR ABUSES.

I said to many friends I EXPECTED THIS BEAR MARKET TO BE A VERY LONG AND DRAWN OUT AFFAIR and it seems with the stupidty of the idiots in power thay have just about sown that seed if they felt they hadnt before no bear market after what we saw in 2007 is over in 2 years and this one is probably the biggest meltdown ever in fiscal terms even more serious than the great depression we havent hit bottom yet we are not even close in my opinon. You just cannot keep spending when you cant afford to pay your debts as they are with tax revenue falling and protectionism being talked about it s all to late to stop what is happening from continuing because it started about the time Ronald Regan was president.

We now have an officail downgrade of US DEBT it was expected but never by the US THEMSELVES how could anyone do that to us they must have been thinking, but again when people suddenly think your not going to pay money owed back they will stop lending you or just before that start charging you a much higher rate for your loans, now how do you think thats going to affect a country like America that can barely cope now with its debt how do you manage to mismange your economy to the tune of 14.3 Trilion dollars whilst amassing some unfunded liabilities being suggested in the region of 34 trillion more its a very very very scary propsect indeed.

These are my views of the world as I see it so back to the markets at times like this if your psychology cannot handle voaltilty then 1 you should stop trading and let things calm down or if you are a trader like me then you cut your exposure by a lot volatilty means bigger swings and ranges of markets where your getting weekly movements in a days range you cut your size down and allow your risk to be minamised as the market jumps around and you stand bank and wait patiently for the market to tell you when to get in.

I have cut my sp trading size down by ten times yet am still managing to make the same amount of profit from my day to day trading the reason is simple your getting much bigger moves happening in seconds they are not to be played with you take your money and get out of the way they are not for the faint hearted and if you get a trade wrong your not crucified for it as you all know the real job for us is to navigate the markets and survive to fight another day even if we lose.

My feeling as oversold as the market is that does not mean we cannot go down further if you dont believe me go back and take a look at 2007 and if you dont think its as serious as then then ask yourself this, is it worse for a bank to go under with massive exposure, or a collection of sovereign nations with even larger exposure to other suffering sovereign nations, so if you think this is all going to be dealt with by a bunch of inept european politicians telling you, we are going to start printing money and buying italian debt and spanish debt with make believe money something they wont actually tell you but thats exactly what it is then these idiots are going to take us all through a world of pain financially whilst blaming everyone else, but themselves as they do it.

I am trained to trade what I see not what I think which is why even though I knew all this I was playing stock market indices from the long side up until March I respect price action as you all should but now its telling you something very different is happening, and you now need to be very very careful dont try to be a hero protect your working capital dont overspend and be very risk averse indeed because in my opinon the ones who have been careful and are being careful now will have a genrational opportunity to take care of their families going forward this is far from done on the downside as I think you will see in the coming months.

Please be very careful with your trading and respect the fact if you dont understand the price action know that sometimes that the best trade can actually be DOING NOTHING AT ALL, whilst preserving your capital let all the other gamblers out there do that you wait for precise patterns to show themselves and they will and then act in a far less risky way with far less capital at risk than normal because this time calls for it.

Best Wishes

HTEngland