HawaiiTrader FOREX & FX Futures Inflection Scalper and Systems LTD

S&P Downgrade PDF file...

2011-08-05T18:24:00.000-10:00

Here's the actual file...VERY VERY VERY interesting stuff. Obviously SOMEONE read the debt bill...and they surely aren't buying it...But who was...
Let's just make money on the way down, and preserve capital. Be careful right now!

http://www.standardandpoors.com/servlet

Trading $EURUSD, $USDCAD, and $GBPJPY tonight...

2010-06-07T00:17:00.001-10:00

Will update if necessary...slow action as of right now...Considering a LONG scalp on the $EURUSD, but I believe we have a lot of major time-frame downtrends to remain aware of. Ultimately, 'the trend is your friend', so no matter what, if you go with the trend you will be bailed out 9/10 times if you have a poor entry.

I think no matter what, we will see resistance in the 136.00 are for the $GBPJPY (if it can get there). And for the $EURUSD, it looks like a descending trendline going back several weeks needs to break and hold at around the 1.20 area, so keep an eye out...

I may try to get short some things here, however, if the environment turns to negative once again. Ultimately, the major trend is down, so just be aware when scalping. Contact me with any questions!

Aloha,
Nigel

p.s. Guys/gals, this is a tough read, but WELL worth it...I always will recommend things that I have personally read and enjoyed or plan on reading. This is one I have read, and yes it's a bear, but the information is highly useful if you plan on going the Fib route for FOREX...

System Ideas and Recommended Reading : )

2010-06-05T21:10:00.001-10:00

Short and sweet this weekend guys/gals, but trust me, the information below is extremely valuable and will help anyone trying to become a consistently profitable trader. The books, WITHOUT QUESTION, are industry standards, have been read by almost 100% of the profitable traders out there, and are a great starting point even for hobby enthusiasts, not just professional traders. I find myself looking through these books time and time again, even though I have read all of them several times. I must say that my favorite 'educational story' is by Jesse Livermore (Edwin Lefevre's perspective) in "Reminiscences of A Stock Operator" and my favorite pure education book is by Mark Douglas, "Trading In The Zone". Those two books alone changed my approach to trading, and in doing so changed my life forever. Powerful stuff, and for those who have the time and effort required to absorb not only the direct lessons and facts, but as well the nuanced psychological and behavioral tips, success is only a matter of your level of determination. Empower yourself and take your trading to the next level...

A quick update on our potential "trading room". I have been in contact with several of you from around the globe (great to have a worldly group!), and it looks like there could be enough quality interest to try some interesting things out. I am proposing to do a sort of 'group meet n' greet' in Webinar format next week. It will be FREE of course, and should give everyone a good chance to look at my charting and systems, ask questions, talk FOREX and trading, and perhaps even find some setups to teach with and give quality examples with so everyone can have a taste of what to expect from a fully paid QUALITY service a few months down the road. Too much hype in this business, far, far, far too much. I became fed up with it years ago and was lucky to get in contact with a few professionals who mentored my development, so naturally I have a great desire to share the success with others, but it's just so hard to separate one's self from "the sludge". So, alas, this is my attempt, and hopefully we can all share in the benefits together! I also realize how hard it is to find quality help out there, believe me, I have experienced my own amount of scams and fast talkers. NOT COOL. And to boot, it just makes the industry more shady and helps nobody. So lets be committed, honest, learn, and make a great deal of cash while doing it. Come join me!

Aloha,
Nigel/Hawaiitrader.... (okay, so yea, not so "short and sweet", lol)

JUNE 3rd TRADING COVERAGE!

2010-06-03T21:16:00.001-10:00

We will be in serious update mode all night guys...Email and check back.. Twitter also...

Nigel4sher@gmail.com

Nigel4sher on Twitter...

Trader Coaching and Real-Time Trading Room..

2010-06-03T14:21:00.000-10:00

Hey Traders-

Going to focusing on getting these two aspects up and running again. Please chime in with any requests/ideas. I am looking to set up a FULL SERVICE, REAL TIME, and PROVEN profitable trading room, but I am only going to accept the FIRST 15 TRADERS who are SERIOUS about trading and serious about making money in FOREX. I will also include free coaching during these trading sessions, as well as individualized one-on-one coaching if this is desired. We will make great trades, we will make money, and we will all learn a heck of a lot from each other. Most of this industry is total BS. That's why I had to go out on my own and figure things out. Now I want to return the favor, and trading with friends is always better! I have great systems and indicator setups that I use in my own trading that I am more than willing to share with others, all I ask is that you come everyday and give it a good effort. The room will be FREE FOR THE FIRST 30 DAYS. After that point, it will only be $24.99/month for basic and $49.99/month for advanced memberships....Details to follow, no need to rush guys/gals. Just let me know what you want/like/thing works/doesn't work...I'm looking forward to it!

Aloha and Happy Trading...

Nigel

I included a few helpful books to get you started down the right path. Books that I have read and most successful traders have read. Right of passage guys!

THIS IS THE HOLY GRAIL OF TRADING MEMOIRS. MUST READ. Priceless takes from Jesse Livermoore, the best trader to ever live.

Fantastic read, BIG time traders talking strategy, psychology, and technique. Must read for serious long term success...

One of my FAVORITE trading books of all time. Marty Swartz, you ROCK! This guy knows about trading, knows the game. These are the types of minds we want to pick...

Hello Traders! $EURJPY trade winner...

2010-06-02T14:48:00.000-10:00

Hey everyone...hope your overnight trading was successful. We have had several nice trades in a row now, so while we never expect to lose, we prepare mentally for the moment when it happens during a 'winning streak'.

Nice $GBPUSD trade two days ago...Another nice $EURJPY trade last night, we definitely had to deal with some whip-saw and shake-outs, but alas, the setup held together and never pierced the low end of the stop range (or the major 240 min up trendline!) which are both powerful together. Along with some RSI confirmation, we should have been in and out within a few hours, +77 pips in hand. Makes about +130 from the last two days, great job guys!

I will be back later....

$EURJPY, $GBPUSD

2010-06-02T00:37:00.001-10:00

LOVING THIS PRICE ACTION GUYS....Classic WEAK LONG shake, and WEAK SHORT induction...

Recipe for profit. Losing traders on the long side just busted....Shorts that just entered will now be squeeeeezed. We take the other side (long $EURJPY) and we take the money. That's how we do it guys...Very nice....

Patience. Stops.

Aloha...

$GBPUSD update..

2010-06-02T00:32:00.000-10:00

If you still have your short on...HOLD IT! Looking good...

My quick $EURJPY scalp is working...holding...I guess I closed that original $GBPUSD short too soon, but alas, this is the life of a trader. No fretting! Next trade...always a next one. Forget the last one...

Working on my $EURJPY trade. Stops still in the high 111's range. Targets low 113's....It is a QUICK SCALP LONG, only based upon heavy shorts in this zone. $GBP can bring that down, however, so keep an eye out and RUN YOUR STOPS....Will update if needed....

$EURJPY quick scalp...

2010-06-02T00:15:00.000-10:00

$EURJPY is looking very bullish, lots of short covering in here....

The original long is still valid, but I am adding a quick scalp in here. Very nice inflection trading, so not a bad idea. This is sort of a 'trade on the side'....No need to follow along, unless you feel comfortable are within proper risk limits, and UNDERSTAND THE ENTRY. Please email me for further info...

Nigel4sher@gmail.com. This is going to be a quick trade, the original long can hold on and let it profit out or stop out.

Aloha....

$GBPUSD... closed short trade...

2010-06-01T23:55:00.001-10:00

Hey Traders...

Well, it's another whippy session here in FX land...I took the inflection short signal on $GBPUSD that I talked about in my previous post, the Fib level from the May HIGH and LOW (approx 1.4732). We spiked a bit over that, but quickly pulled back in as the US futures briefly turned red also. Heavy GBP selling compared to JPY pairs, especially in comparison to the equities and metals/commodity futures. Always good things to watch when planning these scalp FOREX trades. Very correlated.

Anyways, I did extend my stop about 20 pips over the Fib, which was a good call, the average true range of the 240 minute bars were getting pretty big, so it was prudent. Covered this trade for a +51 pip profit...Not great, but not bad at all. Nothing to complain about....

UPDATE:

I have received a LONG signal for the $EURJPY pair, at the breakout of big congestion around the 112.00 area. After spiking below the infamous 110.00, $EURJPY has acted quite bullish, but has been pulled around by Euro weakness/indecision. Sorry for not posting this BEFORE (which I like to do normally), but it was triggered pretty quick. For the record, entry at 112.11 LONG, and still holding. Currently trading 112.59 and looking for more. Lots of shorts in here guys, easy to spook so be careful in here. I would say anything over 112.00 is safe hanging onto, anything below I am out. I am looking for 113.25 as a profit target.

ALWAYS USE STOPS! Add to winners, cut losers, and trim some as the profit stacks up. Don't cut the winners early, but ensure you take some profit home when you have a green trade. This can be as simple as just ensuring that you 'break even', which is actually a profit because of the spread we pay for entry/exit.

Will update as necessary!

Aloha....

June Swoon? Trading notes, helpful books!

2010-06-01T18:51:00.003-10:00

Hello Traders!
Wow, what an evening last night. Big spikes, big illustration of why WE ALWAYS USE STOPS! So, for those of you fleet-fingered traders, last night was a dream-land. Short, long, short, long, fast profits. But for those of you who are still learning, prefer larger/slower time frame trading, or just don't have the time to be a slave to the computer, I wanted to point out a few pieces of literature that I KNOW will help. Investing in our own progress is not simply a good idea, I personally see it as one of the only ways to 'earn your keep'. Battle tested experience is always the best, but have a back-bone to your theory, strategies, and trading in general is a must. The books below provide this and much more. My personal favorite is "Beat th Forex Dealer" by Agustin Silvani. Most dealers in FOREX are not required to follow all of the laws and regulations we might find in a typical broker for equities. Although this is changing, having an inside look at what we potentially are up against (even when we are right and make great trades!) is always a great idea. That stop that gets hit by just ONE PIP, the over-night SPIKE out of nowhere that takes everyone out and seems to THEN and ONLY THEN go in the direction you originally expected. There are ways to avoid these traps, and traps they are. Help yourself and invest in your own success. The trading ideas for tonight are as follows...

GBP/JPY: We saw some major covering and FX official buying into the spike below 110.00 for the EUR/JPY that caused a lot of waves in all other pairs, GBP/JPY included. I had been short most of the night, making small pipage here and there, but was ultimately stopped out when the spike took place. I did manage to get a very nice and unexpected short on the EURJPY right before it sank sub 110. Be very careful around these levels guys, the EURJPY pair is causing a lot of whip-saw on all JPY pairs, and with the Prime Minister 'quitting' and the litany of financial dramas around the globe, these 'defensive spikes' can and WILL come out of absolutely nowhere. This is why we use stops and have disciplined systematic approaches to our trading. Long story short, GBPJPY is dangerous and untamed until further notice. Any trades should be quick scalps and include tight stops. No point in being whip-sawed to death on these guys, this environment is still 'figuring itself out'. My bias for tonight is short, but cautiously...

GBPUSD: Similar story to the GBPJPY pair, but it has acted a bit stronger during the Asian session than our good old buddy GBPJPY. Same for the Euro, which continues to see strong selling into covering waves and profit taking. The GBPUSD is, however, sitting just UNDER a relatively large Fibonacci level at 1.4732. This level corresponds to the high and low of May trading, so while it's not a HUGE level, it is definitely in play with the daily, weekly, and monthly big traders. A break and hold is a great entry long, with stop under the Fib level, same goes for shorts that cannot recover this level and continue down. Stop is the same, Fib level. Again, my bias tonight for this pair is short, a bit stronger than GBPJPY, but pay attention to our critical levels. They must be respected, not fought against.

EURUSD: I am laying off this pair tonight, but it should lead/react to the /DX futures contract (Dollar basket). Watch for key moves getting started there or in gold/oil, but mostly we have seen things the other way around with the Euro reacting to the Dollar and vice versa with regard to oil and gold. The US futures have also begun to head down (as of 2am EST) while the Pound and Yen remain resistant to such movement. We shall see if this holds up. Again, I am staying AWAY from the Euro and looking to JPY pairs and GBP pairs for the main action tonight. Keep an eye on Europe as well...
Happy Trading!

The two other great books mentioned above...

Aloha!

2010-05-31T20:02:00.002-10:00

Hey There Traders!

Wow, it's been quite a long time, but I'm back in blogging/trading action. Life is complicated for all of us, and I found in necessary to relax on publication/blogging and just focus on my own personal trading for a while. In doing so, I have been able to catch up on all sorts of things, renew my commitment to helping others succeed, and help plan my fast approaching WEDDING! Yeeeeep, that time. : ) I am still focusing on primarily spot FOREX, FX Futures, and some basic commodity stuff.

Tonight's tips:

GBP/JPY: strong resistance is showing around the 133.00, shorts are recommended at this level, unless 133.00 is TAKEN OUT and HELD. I would say 133.50 would need to be taken out and held with conviction for any longs to be in order. Otherwise, stay out, or set your limits above the market near the 133.00 area or set some sell stops below the market support around 131.25-131.75.

GBP/USD: similar take as GBP/JPY, but a bit more bullish on the potential for break out. All of the JPY and USD pairs have great short interest at the moment, so that can be a blessing and a curse if improperly perceived. I would say follow Euro action for any GBP/USD 'sympathy moves'. The GBP/USD needs to break and hold the 1.4540 area with conviction for any longs to have serious contention.

EUR/USD: failing at all major resistance areas, what's new? Yea, TONS OF SHORTS, but guys/gals, please realize that some of the most intense moves happen amongst the most intensely overbought/oversold conditions. This does not mean short the Euro here if you are flat, but it does mean that if you are short from above or have a significant lead, you can consider adding on strength/retrace to resistance, or pyramid your position as it moves in your favor, NOT BEFORE. Do not confuse this with setting limit short orders above the market as the natural waves move price up and down between resistance and support. This just means that you should not be adding to a loser, even if you are sure it will come back down. Losers average losers. We don't do that, but we do exercise patience, identify where the losing trader is entering the market, and then we take the other side. I would let the Euro breathe here, watching the US futures, oil, and gold while doing so, but keeping in mind that ultimately the fundamentals of Europe almost require a parity value between the Euro and the USD. We shall see moving forward....

Feel free to contact, aloha!

Happy Trading New Year! (and some trading room ideas)

2009-10-03T14:35:00.003-10:00

Hello Traders! Long time, indeed. The summer is over, and the Fall is in full swing. This means that the Trading New Year has finally arrived! Well, not really but this time of the year always feels like a brand new environment. All the big boys are back, major pieces of economic data always have the markets moving, and in many ways this time of the year sets the momentum both psychologically and fundamentally from now until the Spring. Things can always change, but the addition of major participants coming back into the market place this time of year is undeniable in its influence. It's a great time to get focused, sharpen your strategies, and create some new and positive goals for your own trading.

On that note, I have been contacted throughout the summer and as recently as yesterday about the possibility of opening a trading room. There are really positives and negatives when it comes to trading rooms, but I most definitely know that with a great group of similarly motivated and focused traders, a lot of good things can happen for everyone. I have an interest in creating a forum for all of us to collaborate, but I need more feedback from YOU! What type of trading, what type of lessons, what type of strategies, and on and on. If we are going to do this, we must do it right, and keep the group fairly small. Something like this can be done for less than $50/month, and I am willing to go as far as to say that if you can prove to me beyond a reasonable doubt that you have not profited from being involved with the trading room, you don't pay a monthly subscription fee. I don't think anyone out there does that, but who cares, we can be the first. I always wondered why this wasn't offered by trading rooms, and it became clear as time went on; they aren't making money either! Anyways, let me know what you guys think and we can proceed from there, no rush.

I will slowly be adding to my updates as the days go by, so be on the look out. This weeks opportunities were numerous, no matter what pair you traded and I expect next week to be more of the same. The markets are in transition mode with previous trends shifting to new ones, and signs of this are showing in everything from equities to bonds to currency.

I can be reached at Nigel4sher@gmail.com

Happy Trading!

FX Trends...

2009-07-05T23:41:00.002-10:00

Hello Traders-

Nice action this Sunday PM. We are definitely seeing the process of topping patterns playing out, some of which have already begun to break significantly since their "top". All of this is relative, of course, so keep in mind your time frame, strategy, and risk parameters. The $GBPJPY is down close to 700 pips since its local top on Monday of last week, but if you are a short term guy, the trade could be over or close to over for you if. If you are a trend follower, you could just be getting a nice signal for a much longer term trade. However, whipsaw has been the characteristic of currency pairs over the last 6 months, even while trending longer term, so keep in mind that none of this ever happens in a straight line. We must respect the retraces, reversals, and continuing changes in trend. Still, it is possible that the action from last week into tonight could be signaling something larger as we are seeing these types of movements all over the board from the FX market, to the commodity market, and as well in the equity markets. I covered my shorts from last week on $GBPUSD and the $AUDUSD, and I am looking for some sort of healthy retrace before jumping back into anything. Things have been so volatile that staying on the sidelines is a very powerful tool at the moment. Cathing a nice trend, however, is also a very powerful tool for your account balance. I will be back with any setups I see, but for now I am flat and just waiting. If we see some retrace of the US equity markets last week, and some retrace in the major FX market pairs, I will consider getting short again on several of these, but if we continue down it is going to be dangerous to hop in, no chasing allowed. Hopefully I will be back with some updates later!

Happy Trading...

T Sized Pip: Losing Trader, Exhibit "F"

2009-06-28T15:10:00.005-10:00

Losing Traders and Losing Attitudes,

Hello Traders!

I hope everyone had a great weekend getting rested, refreshed, and relaxed. Or as Ben Lichtenstein over at Trader's Audio would say, "Get Rrrrrrrrrrrrrrrrrrrrrrr'd"....But, I digress...

I do not have too many FX updates as of right now, but I am sure I will as the night progresses. I want to take the time to focus on a small anecdote and trading lesson during this post, so please bear with me as this is not usually the topic of discussion. But, before I do, I briefly want to give my impressions of the FX market in general. Clearly, we are most definitely caught in a heavy storm of consolidation, attempted breakouts, attempted breakdowns, and general whipsaw trading. Central banks and governments are seemingly just as confused, trying to figure out what to do going forward as it is becoming more and more evident that U.S. stimulus and U.S/Worlwide 'recovery' is fleeting. Overall, I will focus on a completely different topic in today's post, simply because these are not the type of conditions we want to put risk capital to work in. Yet many traders do, and they complain when things go wrong. To explore today's lesson on Losing Traders and Losing attitudes, we will focus on the exhibit of one lonely trader/hater who feels the need to try and spoil good things for the majority in the hopes of spoils for the limited. If you are a trader like that, then you most likely are already in the market and do not understand why.

More specifically, if you are known as 'T Sized Pip', AKA, a lonely trader ostracized to the financial/trading wastelands by their lack of wit, lack of intelligence, and most definitely lack of any trading skill, you may want to just go ahead and throw all your chips on the table right now. This type of trader is located somewhere between the 6th and 8th stage of the graph above, just FYI. That's what 'traders' of that caliber do, they shoot in the dark similarly to how they live their lives. We all know that trading results are simply an off shoot of our general life experience. Who knows....After all, you CAN actually hit the dart board if you are BLIND, just as T Sized Pip does 1/10 trades, but you simply can't do this with any mathematically predictive and or probabilistic expectation going forward. These types of traders are what we call "Boom and Busters", swinging big, missing big. Yet, when they DO hit it big the result is even more damaging, making them feel/act emboldened, falsely confident, and dangerously (to their own account) compulsive in any and all trading activity that follows this rare, but majorly successful trade. Now, all of you must be wondering, WTF??? LOL. Where did this come from, and what does it have to do with trading? There is this wonderful little thing called "zero-sum", reflecting the true nature of many trading markets in which for every winner their is a loser. For every credit to an account, there exits a debit to another account. We are in a constant mental battle to out think, out perceive, and out trade our opponents, yet the reality is that 90-80% of all participants loose in the end, leaving only a small proportion of participants with a great deal of the money. This is where our lonely, sad, and confused little soul-of-a-trader "T Sized Pips" comes into the discussion. He/She felt the needed to express comments regarding proper editing, which is never a bad idea, but I guess he/she cannot figure out how to communicate with other living human beings. SO, my apologies to any of the readers who have taken offense to a lack of proper editing at times, this is my fault due to my occupation as a 24/7 Forex/Futures trader causing a massive lack of sleep, and I will definitely do my best to remedy this problem going forward! : ) As for "T Sized Pips", R.I.P in cemetery of losing traders....You will all realized after being involved with trading long enough that those who go needless (usually jealously/ego driven) attacks are also those same traders with no money in their account, no idea of what it takes to win, and definitely a great deal of frustration. All "T Sized Pips" needs to do is look through the archives of this blog to understand that success takes time and is a daily occupation, it is not an event or a status. He/she greatly misses the overall point of trading, which is not to win, but to make money. Winning and loosing has nothing to do with trading, but until he/she figures that out, they will continue to waste away. Lastly, this is also another reason that my blog is not heavily advertised, and I do not offer subscription services or trading alerts. That type of activity simply brings more stress, and why would you need to do that if you are in fact making money doing what you do? That is my question, and as you can see my answer is clear in that I do not offer any of those things. I pay myself, and so should all of you! : )

In conclusion, while this post has not been focused on actual trading, I think it still serves to create a great lesson about the "Boom and Bust" trading cycle, and how important it is a professional trader to keep your eye on YOUR PRIZE, not on other's.....Winning Traders have Winning Attitudes, sounds 'pie in the sky-ish', but its true. We have wasted enough time on people like this, but the lessons we can learn from this type of 'hater' are numerous. When you trade zero-sum, you are potentially trading against somebody like "T Sized Pips" because sadly over 80% of the participants out there are just like this person, losers. Find the loser, and you become the winner.

Hey, but its all in a day's work trying to do what I do. Go ahead and hate, its just part of being successful and it's nothing new to deal with. (and sorry to bore any of you who couldn't care less!) : )

I will be back tonight with updates/setups as they materialize!

Happy Trading....

6/26 Waiting, waiting, and more waiting

2009-06-25T20:48:00.001-10:00

Hello Traders!

Just waiting for the consolidation/whipsaw that has overtaken the FX market to subside a bit. I will be back tonight with updates as they develop!

Sunday Night FX... 6/21

2009-06-21T21:49:00.005-10:00

Hello Traders, hope the weekend was enjoyable. Sunday night FX trading is always fun, and usually has some good action. Hopefully we have some nice opportunities. The chart above shows the classically formed Citigroup Head and Shoulders pattern that we saw as C began to top out and reverse. This is exactly what we want to see with the Euro. The $EURUSD formation is also very clear and visible, but the bulls will not give up easily...

I have waited a few days to post any $EUR/USD Head and Shoulders updates, as we are only seeing consolidation and a bit of whipsaw trading across clearly drawn support/resistance areas. It is my opinion that there are a great many bulls trapped long, and nervous. I still see this pattern breaking downward and continuing as described in earlier posts, not to mention that we have continued to see more bearish signals continuing into tonight's action. It will be very interesting to see where the London Session takes the market, as well as the U.S.

I will post charts as necessary, and updates for setups that I see taking place.

Good Luck!

6/18 Free Live Forex Trading Webinar!! Going Live NOW, Come Join US!

2009-06-18T02:27:00.005-10:00

Is this $EUR/USD H+S going to break or what! Come and find out what we think.

Live Free Forex Trading Webinar! Come join me and my trading buddy DaytraderAnna. She is really a great trader. We will trade, cover charts, talk strategy, and just shoot the breeze...

https://www.gotomeeting.com/join/760998434

2. Use your microphone and speakers (VoIP) - a headset is recommended. Or, call in using your telephone.

Dial 217-287-4112
Access Code: 760-998-434
Audio PIN: Shown after joining the meeting

Meeting ID: 760-998-434

EUR/USD Head and Shoulders Update 5...

2009-06-16T15:00:00.003-10:00

Hello Traders-

Very nice development for our $EUR/USD Head and Shoulders last night. This puppy is steadily increasing strength and pattern recognition from the large time frame traders. This is exactly what we want to see. The attached chart shows what we have been looking for, and have seen on smaller time frames, but we now have a clear illustration on the Daily Chart....

Yesterday's daily candle closed just below the neckline, and while we may whipsaw back and forth within this area for a while, the potential for the next leg down has been fully confirmed, and all we need to do now is enter, set the stop, and walk away. I am personally putting several positions on for the $EUR/USD, some with stops just above the neckline, and others with stops above the top of the right shoulder. These patterns have a very high percentage of reliability, but they also come with a very high level of volatility centered around the neckline area. This can be attributed to the dense confluence of emotion/psychology driven reactions to price, previous enty, previous exit, holding, waiting, anticipating, front-running, chasing, you name it, its all there. However, the key is the daily bar closing under the key level, no matter whether there is retrace or not before it officially breaks. So....Long story short, you are now free to enter on the Daily Chart signal, stops at the very least should go above the illustrated neckline. Like I said above, I will have some stops very near the top of neckline, and some actually above the right shoulder. Either way, set them, and forget them.....

Happy Trading....

6/15 EUR/USD Head and Shoulders Update

2009-06-15T23:20:00.004-10:00

Hello Traders!

Just wanted to throw a quick update your way with regard to our ongoing EUR/USD Head and Shoulders situation. I hope some of you made some coin on the way down, it was a nice ride so far if you have been scalping. I should clarify because I know that I have mentioned very stearn reminders about not front-running and there being no need to get in front of such a large pattern. If you are a scalper, and you are comfortable hopping in and out of things, honoring stops, and generally being 'quick on your toes', then BY ALL MEANS go ahead and trade with the trend. In this case that would be down, and in particular I would probably wait for a nice right shoulder to be formed before really getting any major scalping going. That said....

For those of you doing a longer term style of trading, or maybe just some swing trading, well formed Head and Shoulders patterns offer a great reward with low risk, hence the warning to not front run. There is no need, especially if you are longer term (when I say LONGER, I mean holding your trades a bit longer than a day-trader, not 'investing'.) trader, because these types of patterns produce very nice returns after confirmation, assuming they continue as expected.

I have backed our chart out to a 4-hour chart, and wow, what a beauty. It is also viewable on the daily, which is great. The current status of this setup is on HIGH ALERT. We received a VERY nice confirmation of the pattern signal this AM/late last night, depending on where you live. The neckline, which I have illustrated with a horizontal trendline in the included chart, shows you exactly where you want to get in and also place your stop. The neckline is traditionally seen as the confirmation point for the Head and Shoulders pattern, and after what is usually a healthy retrace to 'test' the broken area, the pattern development ensues and it is off to the races. This, of course, is assuming everything works out out way! We always have to remember that nothing is promised, that's why we use stops! : ) We are currently sitting a bit above the neckline, and we area actually allowed a FULL 100% retrace of the neckline and right shoulder, from a technical perspective, so keep that in mind. If you are down, keep your stops where you feel comfortable, but do not believe that all is lost. This is a confirmed pattern, and therefore a major retrace is needed to blow it up. Until then, the trend is down, and the target is still the target. I will be looking to ADD TO MY SHORT upon a secondary break of the neckline, and I will then put my stop above the neckline. I will repeat this process as many times as is needed, until all the late longs and pained longs give in. If, however, we get a FULL 100% retrace of the right shoulder, you must respect the technical significance and alter course...... Good Luck and please feel free to contact me with questions!

Happy Trading....

6/14 EUR/USD Head and Shoulders Update...

2009-06-14T21:06:00.002-10:00

Hello Traders-

Well, well, well....this puppy is coming along nicely. The updated chart says it all, we have come a little more than 100 pips since the last post. Very nice progress. The 'right shoulder' is forming quickly, but had a very nice basis on which to do so mostly because of the choppy action within the 'right shoulder' from last Thursday and Friday. We like to see that, as we do not want thinly formed shoulders, only to end up having a potential fantastic setup evaporate, or worse yet, end up causing an unnecessary loss due to trying to front-running the confirmation of the overall pattern. This by the way is a NO-NO. I will say this again because I find it to be very important; DO NOT FRONT RUN HEAD AND SHOULDERS CONFIRMATION. At somepoint, your head will be handed to you and nobody wants to have that happen. Interestingly enough, the head of this pattern had a very nice mini-H+S pattern, as well as the right shoulder. Both played out nicely, and since H+S patterns are considered reversal patterns, we definitely like to see the psychology and emotion clearly being played out in same micro-structure that applies to and adheres to the OVERALL structure of the larger pattern at hand. I hope that makes sense, its a big convoluted. Please contact me if not, and I can explain further. The important aspects right now are watching the GBP/JPY, EUR/JPY, and of course the EUR/USD for signs that stops are being run, longs are exiting the market, new shorts are adding, and even newer shorts are coming to play as well. This will all end up with hopefully a clear confirmation of a neckline break, and then we need a test of that area to continue the larger move the is predicted by the overall pattern. I am looking at something like +375-400 pips from the neckline as a target. Cant be exact, but somewhere in that range would not surprise me. I also must mention that patience is of the essence because even if this pattern confirms, it can take some time to reach the overall target. Remember, most losing traders deal with their position for approximately 72 hours if they are not pure day traders, and with time contraction and time cycles, it can take a bit for the market to form properly. But as Jesse Livermoore used to say (not an exact quote), "I made my money from patience, not from trading"-

Good Luck and feel free to write me with questions!

Hello Traders! EUR/USD Head and Shoulders

2009-06-14T16:08:00.002-10:00

Aloha Traders, been "a few" since we last spoke. I like to trade a whole lot less during tough and choppy consolidation periods as we have had over the past couple of weeks in the FX and equity markets, so I have not seen much worthy of posting about until tonight. We have a very nice and very clear potential Head and Shoulders pattern developing on the EUR/USD pair. As with all setups, potentials, and trades, WAIT FOR CONFIRMATION. There is no need to front run, and in this case, there is a lot of meat on the bone so please do not take the chance of having your head handed to you just because you don't want to 'miss out'. You will not miss out if you are patient. In this case, that means wait for the BREAK of the neckline detailed in the chart above. The idea here is that we want to wait until the spike lows from each individual peak are broken. The peaks are the shoulders and the head, the spike lows extend away from the peaks to create the neckline. The beautiful aspect of the confirmed Head and Shoulders pattern is that it is highly reliable, especially after the neckline has broken, been tested, and then failed. At that point trade entry is recommended with a stop on the other side of the neckline..... Good Luck!

$GBPJPY, $EURJPY

2009-05-21T22:32:00.001-10:00

Hello Traders

Awaiting signals for these two bad-boys. Should be some nice action later into the session....

Updates should be forthcoming when they materialize....

Happy Trading!

5/19/09 - 2nd Trade Setup - EUR/JPY

2009-05-19T16:56:00.002-10:00

Hello Traders-

Here is another chart setup I have been working on. I have included potential targets, 1 and 2, for profit stops or bid to cover orders after going short. These are rough estimates, and of course, drilling down for every last pip is not recommended. We always want to keep in mind that most FOREX professionals cover short and sell longs INTO NEW HIGHS. This is a bit different from most markets, where new highs and lows are usually pilled into. I think this EUR/JPY setup has just as much potential as the GBP/USD chart, but it really looks as though this channel is forming a nice bearish channel that could continue downward for days or even weeks. The GBP/USD is a fantastic exhaustion setup, and could very well turn bearish with regard to ascension/descension, but right now the more bearish of the two appears to be this EUR/JPY setup.

Good luck and feel free to ask any questions!

Happy Trading!

5/19/09 GBP/USD TRADE SETUP

2009-05-19T16:26:00.002-10:00

Hello Traders!

Been a few days, action has been slow or choppy, with little follow through to the upside of downside. In general, we have seen JPY pairs trending upwards over the past couple of days, meeting significant chart resistance today. It will be very interesting to see where the break goes, up or down, but for now it looks as though the USD pairs are setting up a little bit more clearly, and with more potential so I am going to focus on a GBP/USD trade setup that I am looking at. The chart here will give you a good idea of what I am thinking with regard to support/resistance, entries and exits. I outlined a previous channel rejection from several weeks ago, in which we got a very nice protracted downward move resulting in 450-600 pips from the point of rejection. These types of setups are fantastic for traders that wish to use a small position with a bit more generous stop in the hopes that a nice move will produce very acceptable profits due to the size of the move. I am personally going to get short the GBP/USD tonight, and set my stop about 25 pips ABOVE the top channel boundary that is outlined on the chart. My profit target order will be located just above the bottom channel boundary, no need to drill for every last pip. That is the way to loose a lot of money, and previously profitable trades.

So, keep an eye out for significant movement on Publish Postthis GBP/USD setup. Things right now appear to have rejected off of the top boundary, but it will be difficult to know whether or not there is serious follow through potential until after Europe opens tonight. I will be back with updates along the way! Good luck, looks like a nice setup!

********HawaiiTrader******** FOREX & FX Futures Inflection Scalper and Systems LTD

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HawaiiTrader FOREX & FX Futures Inflection Scalper and Systems LTD