Bumpy Ride on EUR/USD Scalping

There were some fairly bumpy moves on the EURUSD tonight. I started watching a little before 1am US/Central. It was about 20 minutes before I saw a trade that I liked. The EURJPY was also a little bumpy, but the moves were a little smoother once they got started (which is pretty much the norm).

Based on how the market looks, I’m going to make this one trade be the only trade I take. A 20 minute wait for a setup, and a trade that lasted about 2 minutes for about 14 pips net is still a good day, especially with large lots, isn’t it? :-)

I’m too tired to wrestle with myself or the market. Even if I hadn’t taken that nice trade or there weren’t any trade setups that I liked, I would stop now anyway.

You do the same, too, right? When you’re not “quite in sync”, you step away like a professional, and come back later when you AND the market are in sync with each other, and you are both “in the flow”. I thought so. :-)

### EURUSD Context – Zoom Out

EUR/USD Forex Scalping Market Structure

EUR/USD Forex Scalping Market Structure

*** TRADE #1

The Logical Forex Magnet Lines REALLY helped keep me out of some nasty moments. There was an appearance of a possible Flow Flip immediately before I took the sell, but the Price Flow and Momentum  (price action)  just wasn’t logical given the market structure. And, when price moved, it really took off quickly. A good fill is also a  nice bonus. And, you’ll also notice this was an aggressive trade (for me especially)…another reason I need to stop trading for the day (or at least for a little while). I was “pushing it” and forcing a trade that isn’t normally my preference.

These aggressive trades work fine, I just don’t take them very often, and when I do, it’s usually a sign that I am not “at my best”. Did I ask you if you stop trading when you’re not at YOUR best? :-)

Aggressive EUR/USD Scalp

Aggressive EUR/USD Scalp

Exit #1

I almost will always get out of a trade when price “stalls”. That will show up in your broker quote panel, and sometimes (as in this case) on the chart with a “flat line”. I don’t care what the market does after I exit. No need to “feel any stress”. Profits are ALWAYS good, especially when they come with no stress. :-)

Aggressive EUR/USD Scalp

Aggressive EUR/USD Scalp

4 Responses to “Bumpy Ride on EUR/USD Scalping”

  1. Greg says:

    Hi John.

    Here is my rule, whether I am in profits or in a trade that goes against me (read that again!)…

    “In and Out Quickly, Whenever The Trade Goes Against Me”

    Now, let me explain what I mean…

    Most of the trades I take, price has already built up some nice “momentum”. I can see this in both the chart AND in my broker trading platform.

    It becomes fairly obvious, and quickly, when a trade is going to “go the other way” against you. And, like I’ve mentioned a number of places, I don’t hesitate to get out. If I try to “predict” what price might do, it seems I’m “always” wrong. So, when price is moving in my favor, I stay in until it “goes against me”. And, the same is true if I enter a trade and it “goes against me”…I exit.

    As soon as I enter a trade, I place the majority of my focus on the quote panel, and NOT on the chart. The charts will ALWAYS lag the quote panel, and that’s what I will be using to exit my trade, so I focus there. Yes, I keep the chart “in the corner of my eye”…and that helps me see things like “flat spots” in price, or a tiny retrace, too. But, these things are also VERY visible from your broker quote panel. And with a little practice, you can interpret the quote panel prices as though you are watching a chart.

    Let me add one more important part of what I do…

    I have spent literally thousands and thousands of hours “getting to know my currency pairs”, the EUR/USD and EUR/JPY. When I say “getting to know them”, I mean this…They are “my best friend” or “my spouse”. I know them VERY well. I know how they normally “look” and how they behave, and their normal behavior patterns. And, just like people, the market continuously exhibits these “patterns” in the way that prices moves near Logical Forex Magnet Lines, and is shown with the other Logical Forex Indicators. It is fairly easy to interpret. — If only my friends and spouse had these Indicators. ;-)

    What this allows me to do is give any trade that I enter a little more “room to breathe”. But, I don’t give it much room. Just like with my best friend or spouse, who I know so well, I can tell then they are “reacting oddly” to something. I can tell when they are illogical. The same is true the way I trade forex. As soon as something ‘isn’t right”, I exit without hesitation. There will be better trades that are more “logical” soon enough. So, when the market DOES “go crazy”…I just have to “deal with it”, just like I do with my best friend or spouse. I choose to keep them around, and I do the same with forex. I just try again later.

    Now, what all this translates to is…

    I can’t remember a time when I have bailed out of a trade and lost more than 3-4 pips. I prefer to keep it at 2-3 pips. There ARE some times when I might give a trade a little more “room to breath”, but that’s rare. And, yes, there are times, too, when the market “goes crazy” and spikes. Most of the time, I’ll just “take the hit” and not try to predict what that spike will ultimately do. I just am “In and Out Quickly”, knowing I will have many more opportunities soon.

    If there IS a trick, it’s when a trade is going against you, you absolutely have to avoid falling into a mode where you start predicting…and hoping and praying…that you are or will ultimately be “right”.

    It’s easier to be right when you are, and to exit when you’re not. The nice thing is with Logical Forex, the market moves, you make a logical decision, and and you just go along for the ride…so it’s realy just “price” that makes a trade ”right’ or “wrong”, and you just trade accordingly. Read this again, too. ;-)

  2. Greg says:

    Hi Keith.

    The simplest way to define a “Flow Flip” is when price has made a strong (and obvious) move in a particular direction, and then reverses that direction. It is quite easy to identify with the Logical Forex Indicators, but it does require some patience for everything to develop.

    Perhaps the best way to see these in action is to enter “flip” in the search box near the top right corner of this blog page.

    But, let me describe in a little detail what you’ll be seeing, and what to look for in a “Flow Flip’.

    1. Price has made an obvious move in a particular direction. Let’s say the market has made a 30 pip move down, for this example. You see this (normally) by zooming out a bit on the charts. Sometimes you can even see it without zooming out, especially if price has move 40+ pips in a short period of time.

    2. All of the Logical Forex Flow Lines (in this example) will be red, and will all be below the “spine”, the solid black line that is part of the Logical Forex Flow Lines.

    3. Price will have (usually) made some kind of a bounce near a Logical Forex Magnet Line. The Logical Forex Phase will also often be giving more important information (watch the Online Training Videos again).

    4. Wait for a clear indication that the Logical Forex Flow Lines are now “blue”. The more they have aligned near a nearby Logical Forex Magnet Line, and when the other indicators are in agreement, the more comfortable you can be entering the trade.

    However, just like with EVERY trade, you must be prepared to exit quickly. It is always possible that what looks like a potential Flow Flip is nothing more than a retrace. And, the best way to “get a feel” for this is to spend the time live trading, in Market Replay, regularly reviewing the Online Trading Videos, consistently studying the trade examples posted on the blog, and perhaps the most helpful thing of all, learning some much deeper information in a Private Workshop.

    You’re doing great Keith!

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