GBP/USD 5-30-2007

Until today all of the 4hr bars closed within the range of of the 12:00 GMT bar from May 24 until 12:00 GMT May 29, When we got a close below that bar. They were all inside bars until today.

This indicates that May 24 bar was S/R and May 29 went up to test the top of that bar. That May 24 bar is a range bar. It may not look like one at first but relative to the bars around it, it has to be considered a range bar.

In addition, that May 24 bar is a bear pivot bar of a complex pivot with the swing bar being the may 23 12:00 GMT bar. So, even if we didn't consider the action since may 24 a test of the range bar we would have to consider it a test of the bear pivot swing bar from the 23rd.

So, that's the two reasons price went where it did and because this situation represented double resistance that's why it stopped where it did. When you add this situation to the fact that there has been thin volume because of the U.S. holiday weekend none of the moves since the 23rd have been true moves anyway. That's why I made no blog posts until today.

What really happened today was that operators moved the market up on the 29th just high enough to take out the stops above the high of the 23rd, which was easy enough for them to do because of the thin volume. Most institutional traders won't be back until the 30th and once again true moves will begin. yesterdayday's action was just preparation for todays action.

As far as where we go from here, the GBP has formed a bear pivot on the 29th below the close of the long green range bar. I expect the GBP to go up and test the top of this range bar and bear pivot and then continue back down to test the bottom of this long green range bar.

On the daily chart this green range bar is a bull pivot bar and this pivot needs to be tested. The consider that the 29th on the daily bounced off the top of the upper trend line on higher volume and did bounce down hard. Combine this with the fact that GBP is in a down trend and the probabilities favor a continued test down toward the daily bull pivot point.

Then we throw in the weekly chart that formed a bull pivot outside bar last week by 1 pip, the open of this outside bar needs to be tested and just happens to be at the bottom of the daily and 4hr range bars.

Jerry

EARLY BIRD

EARLY BIRD HAS POSTED SOME INTERESTING COMMENTS ON THE FIRST 2 POSTS TODAY. BECAUSE OF HIM I WILL KEEP DOING IT THE WAY I'VE BEEN DOING IT.

JERRY

LCM TO PERFECTION

LCM TO PERFECTION

Earlier today I gave you the intraday analysis. Now let’s look at the daily chart.

Looking at the chart we can see that we had a bullish pivot form at yesterday’s daily close, on higher volume.

Today we pulled back to test the range of the swing bar and went up to where…? Yep, 3 bar. I have once again numbered the 3 bar count for you and illustrated 3 bar resistance at the red line. Drop down to your intra-day charts and you will see price reversing exactly off 3 bar to the very pip.

This may be just a temporary bounce off of 3 bar but as I teach in LCM, when price hits S/R you should at least expect a bounce.

What is our conjunction/convergence? Well, the same bar that is the 3rd bar in out 3 bar count is a range bar therefore the top of this bar also represents resistance.

Then we see that the top of this range bar is just above Fibonacci 50% from the down move (bear pivot) that began on 5-15. (BAR Z)

Then we see that this same level is at the low of the swing bar of the bear pivot that started the down move on 5-15. (BAR Z)

Summary: We have a bull pivot point at 3446 to define our entry point. We had an intra-day 4hr bull pivot point that formed at 3451 that I illustrated on today’s earlier post. We had a bull pivot on the 1hr at 3427 and 3 bar for this 1hr pivot was 3451. We closed above this 1hr 3 bar target on higher volume to confirm/flow with the daily and 4hr bull pivots. We had two bull pivots on the 30 minute to confirm our other time frame pivots. Thus, all systems were go. These presented a multitude of converging buy signals all supporting each other.

The supports for the targets have already been outlined above and there are others intraday but you get the point.

Question: On the daily 3 bar count I did not count the bar preceding the swing bar. Email me and tell me why you think that is… hint, it was not because it was an inside bar because it fell 1 pip lower than bar 3. But since it was so close I did consider it as an inside bar but the reason I did so was because I had additional, a more important reason not to count it. Do you know what it is? If you are not sure it means that you don’t understand one of the most important requirements for a valid swing bar.

SPECIAL NOTE: AT SOME POINT THIS WEEK I WILL BE CLOSING THIS BLOG TO THE PUBLIC. IT WILL ONLY BE AVAILABLE TO REGISTERED SUBSCRIBERS OF THE LAWS OF CHARTS AND MEN.

I WILL OPEN A SEPARATE BLOG FOR THOSE WHO PREFER FREE INFORMATION THAT IS NOT AS DETAILED AND WITHOUT TRADE CALLS.

THE RESULTS OF THE REAL TIME TRADE CALLS WILL BE POSTED THERE AND GENERAL INFORMATION THAT IS NOT PROPRIATARY TO THE LAWS OF CHARTS AND MEN.

JERRY

EURO/USD TUE 5-29-07

DURING THE TIME IT TOOK ME TO PUT TOGETHER THIS ANALYSIS FOR YOU THE MARKET IS ALREADY MAKING THE MOVE SIGNALED BY THE BULLISH 4HR PIVOT.

SEE ATTACHED 4HR CHART;

Notice how all the bars between bars 1 and 4 are all inside the range of bar 1. The red lines illustrate the high low range of bar 1, the swing bar.

Bar 4 is the pivot bar on this complex bear pivot. LCM explains complex pivots.

Even though bar 4 closed on higher volume and appears to be a valid complex bear pivot, but when you compare it to the volume of the swing bar the volume is much lower. Since we already know that an invalid pivot will meet S/R at 3 bar, we would expect this complex pivot swing to stop down at 3bar support.

When you look at the 3 bar count I have illustrated on the chart we can see that is exactly what happened. Bar 4 formed a bear pivot bar and hit 3 bar resistance on the same bar. Now, I have taught you that when this happens, that pivot has fulfilled its objective and you should look for a reversal or bounce from there.

Bar 4 closed with a strong bounce back up off 3bar and bar 5 formed a bullish pivot reversal bar on higher volume confirming it as a valid pivot reversal.

So, now we have a bull pivot with bar 4 as the new swing bar and bar 5 the pivot bar.

Bar 6 pulled back and tested the pivot point, which is where an entry would be signaled on this bull pivot. We want to enter at the pivot point right?

This analysis is further supported by the range bar. Bar 4 bounced off bearish 3 bar support and this 3 bar support was also the bottom of the range bar. That two levels of support and I often tell you to look for conjunctions of S/R levels to confirm your pivot analysis.

So then, while trying to determine a target for this current bull pivot we know that if the bottom of the range bar has provided support then the market is most likely going to test resistance at the top of the range bar. The top of the range bar also happens to be at 3 bar resistance from this bull pivot. Now, if you can’t see how 3 bar is at the top of the range bar then you can’t expect me to keep repeating the importance of inside bars.

I have marked the top and bottom of the range bar with yellow lines to make it easier for you but I’m not going to make 3 bar because your job is to think and practice.

Lately I’ve been doing everything short of trading your account for you, with great accuracy I might add, yet the only time I hear from most of you is to complain about this or that.

So, since making accurate market calls is not good enough for you then there is no purpose for me to make them is there?

JERRY

EURO/USD UPDATE

WELL WHAT DO WE HAVE HERE...SEEMS AS IF THE HERD HAS ONCE AGAIN BEEN LED TO THE SLAUGHTER.

BUT LCM KEPT YOU OUT DIDN'T IT...THERE HAS BEEN NO BULL PIVOT UP OFF THE RED LINE ON THE 15, 30, OR 60MIN. HAS THERE? SO YOU'RE NOT IN A LONG TRADE ARE YOU...

BUT WE DO HAVE A BEAR PIVOT REVERSAL ON THE 15 MIN DON'T WE. THAT HEAD FAKE ON THE 1HR BAR HAD YOU FOAMING AT THE MOUTH DIDN'T IT. OH MY GOD...OH MY GOD I'M GOING TO MISS THE MOVE.

WELL, I TOLD YA, ONLY RENTER LONG ON A BULL PIVOT UP OFF THE RED LINE. IT CAN'T GET ANY PLAINER THAN THAT. IF YOU WENT LONG DESPITE WHAT I TOLD YOU...DESPITE WHAT YOU'VE SEEN WITH LCM.

YOU DIDN'T EVEN HAVE TO THINK ABOUT NUMBERS, I DREW THE LINE FOR YOU. SO IF YOU WENT LONG...

THE...MATRIX...HAS...YOU. BECAUSE YOU BELIEVE IN THE MOVE INSTEAD OF BELIEVING IN MOTION. YOU BELIEVE WHAT YOU HEARD (HERD) INSTEAD OF BELIEVING WHAT YOU SEE.

THE MOVE IS YOUR RELIGION BUT I BET YOU DIDN'T KNOW THAT WHEN YOU LOOK UP THE ROOT MEANING OF THE WORD RELIGION IT MEANS 'TO SEPARATE", SO CONTINUE TO BELIEVE IN YOUR RELIGION AND CONTINUE TO BE SEPARATED FROM YOUR CASH.

BECAUSE YOU'VE SEEN IT IN ACTION TOO MANY TIMES TO EVEN WANT TO DEBATE. EVEN THOUGH YOUR OTHER WAY HAS FAILED YOU, YOU ARE DESPERATE TO CLING TO IT...

LIKE THE MAN SAYS IN THE MATRIX, THEY WILL FIGHT AGAINST YOU TO DEFEND A LIE...

AND NOW THAT THE LIE YOU FIGHT FOR HAS ONCE AGAIN STOLEN YOUR DREAM IT IS READY TO CONTINUE TO THE LOCATION WHERE YOUR MONEY USED TO BE.

I REFUSE TO BE SO POLITICALLY CORRECT WITH YOU TO MAKE YOU THINK IT'S NOT YOUR FAULT THAT YOU SWALLOW LIES AND WILL FIGHT AGAINS TRUTH WITH YOUR LAST BREATH. IT IS I WHO IS IN THE TRENCHES WITH YOU AND IT IS ONLY I WHO WILL TELL YOU THE TRUTH.

JERRY

EURO/USD TRADE UPDATE 5-25-2007

OKAY, IF PRICE CONTINUES AND BLOWS UP TO THE YELLOW LINE I MISSED THAT PORTION OF THE MOVE. IF NOT, I'M LOOKING FOR A PULLBACK AND A BULL PIVOT UP OFF THE RED LINE. SEE ATTACHED 1HR CHART.

THAT IS...IF WE ACTUALLY DO CLOSE ABOVE THE RED LINE.

I WILL EVEN CONSIDER A 5 MINUTE PIVOT OFF THE RED LINE IF IT LOOKS STRONG ENOUGH.

JERRY

EURO/USD UPDATE

CLICK THE LINK BELOW FOR THE PRE-TRADE TRADE ANALYSIS.

I WILL BE LOOKING FOR A 15 MIN BULL PIVOT TO REENTER NEAR THE ORIGINAL ENTRY AREA OF 3435. OPERATORS LIKE TO UNDERCUT KNOWN (HERD) LEVELS SO WHEN I SAW VOLUME WEAKNESS ON THE 30 MINUTE I DIDN'T LIKE THE SMELL OF THINGS.

IF PRICE CLOSES ABOVE 3459 I WILL LOOK FOR AN INTERNAL PIVOT ABOVE THAT AREA FOR A REENTRY.

SO I AM LOOKING AT TWO POSSIBLE RE-ENTRY LEVELS.

JERRY

CLICK HERE FOR ANALYSIS

JERRY

EURO/USD 19 PIP PROFIT

TOOK PROFTIS AT CLOSE OF 9:00 BAR. VOLUME DIVERGENCE ON 30 MIN CHART. WILL LOOK TO REENTER ON PULLBACK OR CLOSE ABOVE 3459.

JERRY

EURO/USD

I STAND CORRECTED. WE DO HAVE AN INTERNAL PIVOT BAR ON THE 1HR THAT JUST CLOSED AT 8:00AM EST AT 3435.

I'M IN AT 3436 AT 8:05 EST

JERRY

EURO/USD UPDATE

THE 4HR BAR THAT JUST CLOSED A 8:00 AM EST JUST FINISHED TESTING THE BULLISH PIVOT POINT. ON LOWER VOLUME. A GOOD SIGN FOR THE BULLS. ON A BULL PIVOT, WE LIKE TO SEE THE TEST BAR CLOSE DOWN ON LOWER VOLUME.

STILL NO ENTRY SIGNAL. WATCH YOUR 30 MIN AND YOUR 1HR. EVEN WATCH YOU 15 MIN AND LOOK FOR IT TO CONFIRM YOU 30 OR 1HR PIVOT.

THE ENTRY SIGNAL, IF THERE IS ONE, WILL PROBABLY COME AT 9:30 AM EST JUST BEFORE THE U.S. DATA ON EXISTING HOME SALES THAT COMES OUT AT 10:00 AM.

REMEMBER, NO INTERNAL BULL PIVOT TO GO WITH THIS 4HR BULL PIVOT MEANS NO TRADE. YES, THIS CAN SOMETIMES CAUSE YOU TO MISS A MOVE BUT MORE TIMES THAN NOT IT KEEPS YOU OUT OF A FALSE MOVE.

JERRY

EURO/USD TRADE SIGNAL

THE EURO/USD HAS FORMED A TRADE SIGNAL. I HAVE ATTACHED THE CHART. CLICK THE LINK BELOW FOR THE TRADE ANALYSIS.

CLICK HERE FOR ANALYSIS

JERRY

GBP 2ND POST 5-24-2007

This post is to give you an example of how strict adherence to LCM should have kept us in good position today. I’m feeling that many of you did not get out on the 1hr bull pivot. Why do I say that? Because the market rose just high enough to take out my suggested stop price before busting down…

You would be surprised how many people across the globe are following my calls. You don’t get too many with the guts to make public calls and explain when I why they are making those calls. So, when we do find someone like that, word spreads like wildfire.

The only problem is that my LCM STUDENTS KNOW WHAT I’M TALKING ABOUT WHEN I SAY THINGS LIKE PIVOT, TEST, AND SWING BAR. SO IF I SAY GET OUT ON A BULL PIVOT ON THE 1HR, MY STUDENTS WILL KNOW WHAT THIS MEANS AND BE OKAY.

THOSE WHO ARE NOT MY STUDENTS HAVE NO CHOICE BUT RIDE OUT THE TRADE TO THE STOP LEVEL, WHEN THEY DON’T KNOW THAT WE ARE ALREADY LONG GONE.

So, let’s take a look at how my students should have done it today.

SHORT ENTRY AT 9863 ON TEST (PULLBACK) BAR TO 1HR BEAR PIVOT POINT.

EXIT: AT CLOSE OF BAR (1) 9867 CLOSE OF 1HR BULL PIVOT BAR. (4 PIP LOSS)

LONG ENTRY: ON TEST (PULLBACK) BAR (2) TO BULL PIVOT POINT AT (9860).

EXIT: CLOSE OF BAR (3) AT 9879. WHY…VOLUME RULES. WE GOT A BAR WITH A HIGHER CLOSE ON LOWER VOLUME. My students who have the ARCHIMEDES PRINCIPLE-VOLUME REPORT know that this is definitely an exit signal. Then double that exit signal because it hit 3 bar resistance to the bull pivot.
Result (19 pip profit).

Summery: 2 trade signals 2 exit signals = 19 pip gain – 4 pip loss = net gain of 15 pips

Now, when we do it that way, strict adherence to LCM, this is what we end up with. And now we avoid what was obviously an operator shakeout. Now if this current 1hr bar closes below bar 3 with higher volume, as it looks like it will, we are in a position of profit already and we have no fear of trading this soon to be bear pivot.

Did I trade it this way. Honestly no I didn’t. However I normally would when I can stay awake. I took my 4 pip loss. Updated you and was about to return to bed. Then of course I see the current swift down move after the U.S. data and just cannot help illustrating this scenario to help you along in your progress. Yeah I know what you’re thinking. That’s why I’m having so much trouble getting rid of this rotten sinus infection.

So, just do something for me. Whenever I make a special note for you to get out when a specific event takes place, please do it. For me to make that special note then you know I had a specific reason. And that reason was that the market had not closed below 23% Fibonacci from yesterdays up move, and we didn’t have a valid 4hr pivot.

But if you took my suggestion and got out on that bull 1hr pivot, you should have no fear to trade this bear pivot that just formed. So, I’ll leave you with this.

If you trade this 1hr bear pivot that just formed, only go short on a pullback (test) of this pivot, and only do so if you get a 15 or 30 min bear pivot below the 1hr bear swing bar 9863 from this bear pivot. that's bar# 3 in red on your chart.

Jerry

GBP trade update 5-24

Hopefully you if you followed the call, then you exited on the 1hr bull pivot off 23% fibonacci support at 9767, with higher volume at the bar which opened at 7:00 est closed at 8:00 est. a small loss of 4 pips from the entry of 9763.

I have marked the pivot bar on the chart and we/you should have exited at the close of this bar.

As for me I just can't seem to get over this sinus infection. so it is slow motion. But I wanted to get this update out to you before I hit the wall.

In addition I am having connection problems at the moment so the chart is coming, I'm just having problems getting it up.

But just remember this is how I trade. I get out on the early pivot warning signs. Now if I was feeling better I would have reversed and went long on the 1hr bull pivot.

You see, a 4-5 pip loss is eaily made up when you turn and flow with the market. So, I went down with the bear pivot and when there is a bull pivot I just reverse and go long.

I probably should not have mentioned this trade to you not knowing if I would be able to update you real time, thats why I told you to get out on a bull pivot. But still I would have liked to update you in real time when the bull pivot occured.

In short this is an example of what I mean when I say keep your losses small and profits will take care of themselves.

Jerry

GBP TRADE 5-24-2007

time 4:30 est

SELL SHORT

entry 9863 pullback to 1hr bear pivot
stop 9885
target 9805
or exit on 30,60min or 4hr bull pivot

jerry

GBP DAILY CHART 5-23-2007

I rushed out the last post and here is the daily perspective chart. If we do not get a bear pivot on the intraday you can look for price to carry up to the daily trendline.

The top area of the long white range bar (blue lines) is appearing more and more to be the ultimate target. not only that but it is 23% fib retracement on the daily and is upper trend line resistance. so that is triple resistance which appears to be the only thing that can stop this runaway train.

a close of this current 4hr bar above the upper 4hr trend line will signal next stop that daily triple resistance. At the rate it's going it may hit that daily resistance before this current 4hr bar closes.

Not only Did United Kindom raise rates, they expressed a bais towards raising rates even higher which is going to make GBP VERY STRONG.

jERRY

GBP UPDATE 5-23

As you can see by my post last night the market has not presented any surprises. Unfortunately when the entry signal came at 5:00 am est I was asleep. I tried to stay up but this nasty little bug I have and the medication I am taking for it would not let me.

If you are following the news as I've been suggesting then you knew that an interest rate meeting was held for the United Kingdom today, while most United states traders were asleep.

We had an outside pivot bar that formed at the close of that 5 o'clock bar and it formed after hitting 62% fibonacci and yesterdays open as I told you we would first fall to here then go up and this is exactly what occurred.

This 1hr outside bar (pivot bar) closed above the trendline. Had I been awake this was an entry signal. Then this market closed above 4hr 3bar at the close of the 6:00 am bar which was another entry signal. And in a classic formed pulled back to touch 3bar in a support/resistance reaction as outlined in LCM.

As you can see, we have now stalled at the upper trend line that I indicated would be the target for and up move. The market needs to rest and should reverse pivot down here on the intraday to the 9770 area to test the area of the breakout which is also a retest of 38% fibonacci on the daily chart as well as a test of the daily pivot point.

So, as always I don't trade on what I think I trade on what the market shows me. I'll be watching for a reverse bearish pivot off this upper trendline on the intradays to confirm my analysis. In that way it doesnt cost anything if I'm wrong.

So, sorry I couldn't get in what you would call a specific market call with entry an exit but, it did come as close to that without just saying trade here. I gave you all the information you would need to make an informed decision. Everything except hand you the trade on a silver platter.

Jerry
Email me! click here

GBP UPDATE FOR 5-23-2007

You can look at the chart and see that the market bounced off 3 bar resistance on the 4hr. For those who still don't understand the concept I have shown the count in red numbers on the chart.

Once again I illustrate that you do not count inside bars I have illustrated the range of bar 3 because all of the bars between bars 2 and 3 are inside bars. They are inside of bar 3, thus they are not included in the count.

Then once again this also illustrates that the difference between a valid pivot and and invalid pivot is that with an invalid pivot, price can be expected to bounce off 3bar while a valid pivot can be expected to go above 3 bar.

Since this is an invalid pivot as evidenced by the pivot bar forming on lower volume one would have assumed that 3bar resistance would stop the up move just as taught to you in LCM.

Now if you turn your attention to the internal trendline, you remember me telling you to always draw your trendlines a couple of days ago right?

Well, anyway, you can see how the trendline cuts right across the top of 3bar. Yep that's double resistance. That's why in my post today I told you I didn't expect price to go beyond 9755 and we did, in fact close below this level at 9740. This gives me a chance to emphasize that when I talk about price levels I'm usually talking about closing price. Closing price is when I make most decisions. You don't know what a man will do until his foot lands on the ground. As long as his foot is in the air his direction is not committed. When that foot lands he has committed.

For this reason I make most of my entry decisions based on the close of a bar. However, I will exit the position on a touch of my target unless indicators, such as volume warn me to exit before the target touch.

So, here's what I expect for today. I expect price to form a bullish pivot on the daily chart. This is because we closed up today on lower volume (see your Archimedes report-volume principle). This tells us the down move has stalled because of the buoyancy principle explained in THE ARCHIMEDES PRINCIPLE.

I expect price to fall and test yesterday's open around 9713 and then rise up to close above yesterdays close to form a bull pivot. This is also the area of 62% fib retracement from the intraday up swing ve experienced today. On an intraday basis, price tends to focus the 61% retracement as support/resistance.

We have 3 keys to look for to confirm the bullish undercurrents at the moment. To be confirmed as going up this market needs to close above 3bar and the trend line I spoke about above.

Then our 3rd key is the often spoken about range or spike bar. I have drawn a line (blue line) across the open or the range bar we had on 5-15. As long as price is below here that is a third layer of resistance. If we get a close above this 3 stranded layer of resistance on the hourly chart on higher volume I'll be looking for a continuation up to the top of said range bar at 9861 which also happens to be at the upper trendline so any upmove is likely to target this area.

Hopefully you've been noticing that I look for conjunctions of indicatations at a level before I consider it for support or resistance. I like to have a conjunction of 3 planets but 2 will do. Hey, a table must have at least 3 legs to stand on to be stable.

The market may be setting up for me to enter a trade today but we'll see if we get the necessary pivots to give us the entry signal.

Jerry

GBP 4HR 5-22-2007

I guess you can see now why I suggested that you follow my lead and exit the GBP trade with the 81 pip profit. Now why did I do that if the target was not hit?



There were two reasons. The first being that the market started hesitating at the lower trend line. The second is that it was a light news day and news is the fuel that propels a market.



If you have my book THE LAWS OF CHARTS AND MEN you know by reading the section on how a market reacts at support/resistance what to look for.



CLICK HERE FOR A MORE IN DEPTH ANALYSIS WITH CHART.



Jerry

GBP TRADE CLOSED 8:00 am est

GBP TRADE CLOSED AT 9686 FOR 81 PIP PROFIT.





JERRY
Email me! click here

GBP TRADE UPDATE 5-21-07

TAKE YOUR PROFITS ON ALL GBP SHORT POSITIONS ON ALL TIME FRAMES AT THE CLOSE OF THE CURRENT 4HR BAR WHICH CLOSES AT 8:00 AM EST. I'M NOT SAYING THE TARGET OF 9658 WON'T BE HIT, I'M SAYING WE'VE CAPTURED A NICE MOVE DOWN FROM 9767 AND NO NEED TO TRY TO SQUEEZE EVERY LAST DROP FROM A TRADE. IN OTHER WORDS, NO NEED FOR GREED.

TOO OFTEN 8:00 AM IS REVERSAL TIME SO BE SAFE. YOU WILL NEVER GO BROKE TAKING A PROFIT TOO EARLY BUT YOU CAN GO BROKE TAKING A PROFIT TOO LATE.

JERRY

GBP IN DEPTH ANALYSIS END OF DAY 5-18-2007

Many times when we look deeper we find patterns in the most unsuspecting places. Most truth is hidden in the most secret of places and that place is PLAIN SITE...

Friday was a typical pre-G7 trading day. China made a last minute play to strenthen her hand going into the meeting.

The resulting short covering rally spooked and shook many out of their positions.

IF YOU WANT TO SEE A RECAP ON FRIDAY'S TRADING CLICK HERE FOF CHARTS AND ANALYSIS.

Jerry

GBP TRADE CALL

CLICK HERE FOR GBP LIVE TRADE CALL 5-18-07

JERRY

WHAT ABOUT NOW?

GIVE HIM TILL THE CLOSE OF THE 4HR STEP TO COFIRM HIS SHORT INTENTIONS. A CLOSE BELOW HIS NECK MEANS A STUMBLE DOWN.

BY NOT ENTERING NOW YOU COULD MISS THE MOVE...

BY ENTERING NOW YOU COULD BE FAKED OUT OF YOUR UNDERWEAR...

WILL UPDATE.

JERRY

JERRY

MAN ONF THE 4 HR GBP

HERE IS THE CHART CAN YOU SEE HIM?

JERRY

KILL PULLBACK

AT THIS POINT WE CAN KILL THE PULLBACK LIMIT ORDER. AT THE CLOSE OF THIS 4HR BAR WE WILL HAVE A VALID FOLLOW THROUGH BAR TO THE SHORT PIVOT IF WE GET A CLOSE BELOW 9806.

WHAT WE ARE WITNESSING NOW IS A REVERSAL TEST OF YESTERDAY'S 4HR BULL PIVOT. WHICH MEANS THAT IF WE CLOSE THIS BAR BELOW 9806 THE ODDS ARE HIGH THAT WE WILL TEST THE BOTTOM OF THE 4HR RANGE BAR FROM YESTERDAY AT THE 9753 AREA.

BUT REMEMBER THE DAILY RANGE BAR IS STRONGER THAN THE 4HR RANGE BAR AND REALLY THERE IS NOTHING UNUSUAL ABOUT WHATS GOING ON.

THE MARKET IS TESTING THE DAILY BULL PIVOT,WHICH IT NEEDS TO DO IF IT IS TO CONTINUE UP. THE LOW OF YESTERDAY IS THE LOW OF YESTERDAY'S OUTSIDE BAR THAT FORMED THIS CURRENT BULL PIVOT SO UNTIL THE MARKET BREAKS THIS LEVEL, THE BIAS IS STILL UP BECAUSE THE DAILY PIVOT IS STILL IN PLAY.

AS LONG AS THE DAILY PIVOT IS STILL IN PLAY THE BIAS IS STILL UP. THE INTRADAY LEVELS ARE SECONDARY SUPPORT/RESISTANCE TO THE DAILY.

THE CLOSE OF THE DAILY RANGE BAR FROM LAST WEEK IS THE REAL TRUTH AT 9787. IF WE BREAK BELOW THIS THEN THE OPEN OF THE 4HR RANGE BAR IS NEXT.

THIS IS WHY IT'S GREAT IF YOU CAN MONITOR THE MARKET BECAUSE THAT WAY YOU COULD HAVE BEEN SHORT AT THE FORMATION OF THE BEAR PIVOT AND YOU WOULD NOT CARE WHERE SUPPORT WAS FOUND BECAUSE YOU WOULD JUST TURN AROUND AND GO LONG ON A BULL PIVOT, WHICHEVER SUPPORT LEVEL WAS FOUND. YOU DON'T REALLY CARE.

THE ONLY THING IS THAT WHEN YOU ENTER AT THE CLOSE OF A PIVOT BAR WITHOUT WAITING FOR THE PULLBACK, YOUR STOP HAS A MUCH LARGER RANGE, BUT IF YOU WAIT FOR THE PULLBACK YOU RISK MISSING THE MOVE.

SO, THIS IS REALLY WHERE YOUR VOLUME RULES CAN HELP YOU. SAY YOU ARE LOOKING TO ENTER SHORT ON THE 4HR PULLBACK TO THE PIVOT. HOW DO YOU KNOW THE PULLBACK IS NOT GOING TO MAKE IT BACK TO THE PIVOT POINT SO YOU DON'T MISS THE MOVE.

OKAY, LOOK AT YOUR 30 AND 60 MIN. SEE HOW YOUR VOLUME RULES COULD HAVE CLUED YOU IN THAT THE PULLBACK WAS OVER AND WAS NOT GOING TO REACH THE PIVOT POINT.

THE LAST BAR ON BOTH THE 30 AND 60 MIN BOTH CLOSED UP ON LOWER VOLUME. THIS WAS A SIGNAL THAT THE PULLBACK (TEST) OF THE 4HR SHORT PIVOT WAS OVER.

ALWAYS, ALWAYS, ALWAYS... LOOK DOWN AT LEAST 1 TIME FRAME FOR YOUR EARLY SIGNALS.

JERRY

GBP FINE TUNING ENTRY

OKAY, IF YOU ARE IN A POSITION TO MONITOR THE MARKET, YOU COULD THEN FINE TUNE YOUR 4HR SHORT LIMIT ORDER , PULLBACK ENTRY IN THIS WAY.

LOOK AT THE CHART AND FOCUS ON THE 4HR AND THE 1HR. YOU CAN SEE THAT THE 4HR IS IN PULLBACK MODE BUT THE 1 HR IS TRYING TO BULL PIVOT.

WE WON'T KNOW IF A BULL PIVOT HAS ACTUALLY FORMED ON THE 1HR UNTIL THE END OF THIS 1HR BAR. BUT WE CAN SEE THAT THE CLOSE OF THE LAST 1HR BAR HAS FORMED A POTENTIAL SWING BAR. SO WE CAN PROJECT AHEAD OUR 3BAR COUNT FROM THERE TO THE 9853-56 RANGE.

BUT WHAT WE DO KNOW IS THAT IF IT DOES PIVOT WE CAN SEE RIGHT NOW WHERE OUR 3 BAR TARGET WILL BE ON THE 1HR IF THE PIVOT DOES FORM AT THE END OF THIS BAR , THAT IS THE 9853-56 RANGE.

SO NOW WE CAN ADJUST OUR 4 HR LIMIT SHORT ENTRY TO 9853-56, THE PROJECTED 3BAR LEVEL OF THE 1HR. A FILL THERE WOULD REDUCE OUR POTENTIAL STOP TO 20-25 PIPS.

AND, MOST LIKELY THERE WOULD BE AT LEAST A SMALL BOUNCE OFF THAT 1HR 3BAR SO THAT IF THE 4HR DID CLOSE UP AFTER YOUR 4HR SHORT LIMIT ORDER HAS BEEN FILLED YOU CAN STILL CLOSE IT WITH A SMALL PROFIT AND THEN LOOK TO GO LONG WHEN THE LONG SETUP IS FORMED.

IF THE 1HR PIVOT DOES NOT FORM THEN ADJUST YOUR SHORT LIMIT BACK DOWN TO 9846. THEN IF THE 1HR GOES DOWN AND PIVOTS UP AGAIN LOWER, YOU MAKE THE SAME ADJUSTMENT AND RECALCULATE YOUR PULLBACK ENTRY BASED ON 3BAR IN THE SAME WAY.

YOU DO THIS AS LONG AS THE 4HR PULLBACK IS IN PROGRESS. AT THE END OF THE 4HR PULLBACK (TEST) BAR, IF YOUR SHORT ORDER HAS NOT BEEN FILLED YOU CANCEL IT AND RE-ANALYZE THE SETUP BASED ON THE CLOSE OF THAT 4HR BAR.

YOU'RE IN THE GAME EITHER WAY AND YOU DON'T CARE IF THE MARKET GOES UP OR DOWN. JUST RIDE THE WAVES BABY, JUST RIDE THE WAVES.

YOU MAY THINK THIS IS PLAYING IT TOO FINE BUT IT WORKS AND IF YOU ARE TRYING TO WORK WITH A $250-300 MINI ACCOUNT IT IS THE PERFECT WAY TO LOOK AT THINGS.

IT IS NOT THE WINNING TRADES THAT DETERMINE YOUR SUCCESS BUT THE LOSING ONES, AS IN WHEN YOU LOSE YOU LOSE SO SMALL THAT YOU CAN STILL STAY IN THE GAME FOR A LONG TIME. LIKE YESTERDAY'S 21 PIP DRAWDOWN.

IF YOU CAN KEEP YOUR AVERAGE LOSSES IN THAT AREA YOU WOULD HAVE TO LOSE ABOUT 10 TRADES IN A ROW BEFORE YOU SET OFF YOUR MARGIN ACCOUNT LIMIT.

JERRY

Email me! click here

GBP PULLBACK

NOW IF YOU WANT TO PLAY BOTH SIDES THIS IS HOW YOU DO IT.

WE HAVE A BEAR PIVOT ON THE 4HR.

NOW, WE KNOW THAT IT WILL TAKE AT LEAST TO THE CLOSE OF THE NEXT 4HR BAR FOR THE MARKET TO FORM A BULL REVERSAL ON THE 4HR.

LOOK AT THE CHART. THE PIVOT POINT OF THIS BEAR PIVOT NEEDS TO BE TESTED. IF IT PULLS BACK TO THE PIVOT POINT DURING THIS CURRENT BAR, THAT IS A PULLBACK TO THE PIVOT INSTEAD OF A REVERSAL TO THE PIVOT.

THEN YOU COULD GO SHORT AT THE PIVOT (WITHIN THE RANGE OF THE BEAR SWING BAR) WITH YOUR STOP ABOVE THE HIGH OF THE BEAR SWING BAR.

FOR EXAMPLE; YOU COULD PLACE A LIMIT ORDER RIGHT NOW TO GO SHORT ANYWHERE BETWEEN 9846 AND 9872 (THE RANGE OF THE SWING BAR). AND PLACE YOUR TARGET AT 9820.

AT THE END OF THE 4HR BAR, IF YOU ARE NOT IN YOU CANCEL THE ORDER. IF YOU ARE IN AND THE MARKET IS STILL WITHIN THE RANGE OF THE PIVOT AT THE CLOSE OF THE BAR, YOU WOULD CONSIDER AN EXIT. THE BEST PULLBACK PLAYS WILL BOUNCE BACK QUICKLY OFF THE PIVOT.

IF YOU ARE NOT IN AT THE CLOSE OF THE BAR, YOU START LOOKING FOR A BULL PIVOT BACK UP.

THIS WAY IF YOU'RE IN AT THE CLOSE OF THE BAR AND IF LOOKS LIKE A REVERSAL IS COMING YOU CAN CLOSE OUT YOUR POSITION AND LOOK TO SWITCH LONG, CLOSING OUT YOUR PULLBACK PLAY WITH A VERY SMALL LOSS OR A SMALL PROFIT.

SINCE THE RANGE OF THE SWING BAR IS ONLY 26 PIPS YOU CAN PLACE YOUR STOP 4 OR 5 PIPS ABOVE IT AND RISK ABOUT 30 PIPS.

YOU WOULD PLACE YOU TARGET AT THE OPEN OF THE LONG RANGE BAR SINCE WE KNOW RANGE BARS ARE SUPPORT/RESISTANCE.

SO, YOU COULD ALSO PLACE A LIMIT ORDER TO BUY AT THE RANGE BAR OPEN.

IN THIS WAY YOU HAVE 2 OPEN ORDERS, 1 LONG AND 1 SHORT. YOU HAVE BOTH SIDES COVERED. THIS IS REALLY THE ESSENCE OF LCM.

YOU COULD PLACE BOTH LIMIT ORDER AND CHECK BACK AT THE CLOSE OF THE NEXT 4 HR BAR TO ASSESS YOUR POSITION. NO PIP BY PIP STRESSING.

THIS IS HOW YOU PLAY BOTH SIDES. YOU CAN FLOW AS THE MARKET FLOWS AND IN THIS WAY IT DOESN'T MATTER WHAT YOUR BIAS IS BECAUSE YOU ARE RIDING THE WAVE WHICHEVER WAY IT FLOWS.

IF THE MARKET CONTINUES DOWN WITHOUT TESTING THE PIVOT, THEN WHEN IT DOES HIT SUPPORT THE ODDS ARE MUCH HIGHER THAT IT WILL REVERSE BACK UP TO TEST THE PRIOR BEAR PIVOT.

AND PERHAPS MOST IMPORTANTLY, LOW STRESS TECHNIQUE.

JERRY

GBP 7:45 EST

NOTICE HOW THE GBP HAS REVERSED DOWN ON MULTIPLE TIME FRAMES. SEE, THIS IS NOT A PULLBACK. NOW, INTRADAY YOU ONLY WANT TO ENTER LONG ON MULTIPLE PIVOT REVERSALS TO THE UPSIDE. SO DON'T GET ANTS IN YOUR PANTS. THIS WILL KEEP YOU OUT UNTIL THE TIME IS RIGHT OR ALTOGETHER IF NEED BE..

JERRY

USD/CHF UPDATE

OH YEAH...I DIDN'T GET A CHANCE TO MENTION YESTERDAY THAT THE CHF CALL I POSTED ON 5-11-2007 HIT THE PROFIT TARGET YESTERDAY FOR A 48 PIP PROFIT. REFER TO THAT POST FOR DETAILS.

SO, SINCE 5-4-2007 WE'RE 6 OUT OF 7 PROFITABLE WITH LCM. THE 21 PIP LOSS ON GBP YESTERDAY BEING THE 1 LOSER. AND EVEN THAT ONE TURNED AROUND TO HIT OUR TARGET ON THE SAME DAY, WHICH ILLUSTRATED A CLASSIC OPERATOR NEWS MANIPULATED SHAKEOUT.

JERRY
Email me! click here

CHART FROM WEBSITE

SOME OF YOU HAVE TOLD ME YOU'VE HAD TROUBLE VIEWING YESTERDAY'S GBP CHART ON THE WEB SITE.
TRY THIS ONE.

The pullback to test the pivot has begun. We are approaching 9820. Remember only go long on a pivot reversal. If you cannot watch the market place your limit orders and only scale in if you trade multiple contracts.

place half your position at 9806 and the other half at 9787. take profits at today's high on the first position and 9820 on the second. Yesterday's bullish range bar is the biggest risk as the market my want to test it.

The most conservative play of the day for daily chart players is to place your long entry around 9755 near the low of the 4hr range bar from yesterday and place your stop a few pips below yesterday's low. If you are playing say 5 contracts, place a limit to go long at each support level to spread out your risk.

When you scale in this way you will make a profit when the market falls below your entry level to the next support level then come back up to your level with 2 or 3 contracts instead of 1. It only has to come back 50% to you for you to break even instead of all the way. Also you will have at least 1 position if the 1st level holds so you don't risk missing the move.

Between 8:30 and 11:00am est the U.S. has 5 data announcements so be carefully as the talking heads have plenty of excuse to shake you out of your positions.

There is a G7 meeting this weekend and the markets have a tendency to do strange things before G7. Each county tries to manipulate their currency positions as bargaining chips the way China did yesterday.

See, some of your biggest adversaries are governments because they also play the currency game.

Jerry

GBP/USD FOCUS

I'VE GOT A BONE TO PICK WITH THE POUND SO I'M GOING TO STICK WITH THAT PAIR AS MY FOCUS.

THE DAILY FORMED AN OUTSIDE BAR PIVOT TODAY. IT ALSO TESTED AND CLOSED ABOVE THE CLOSE OF THE BEAR RANGE BAR THAT PRINTED 5 DAYS AGO.

THE FIRST LEVEL OF SUPPORT IS THE PIVOT POINT AT 9820.

THAT MEANS THE CLOSE OF THAT RANGE BAR IS SUPPORT. TO ADD TO THAT SUPPORT THE OPEN OF THE SWING BAR. ADD TO THAT IS THAT THE SWING BAR REPRESENTS A PREGNANT MOTHER FORMATION.

SO NOW WE HAVE SIGNIFICANT BOTTOM SUPPORT AT 9787.
THESE ARE OUR KEY NUMBERS BASED ON THE PRICE PATTERN.
9820-DAILY PIVOT POINT
9787-BOTTOM SUPPORT
9806-4HR PIVOT POINT

MARKETS MOVE LIKE TIDES EBB AND FLOW. SO WE ARE LOOKING FOR A PULLBACK FROM TODAY'S SURGE. AND WHEN WE TALK ABOUT PULLBACKS WE'RE TALKING ABOUT FIBONACCI LEVELS.

TODAY'S UPSURGE BOUNCED OFF THE 50% FIB LEVEL FROM THE MOST RECENT DOWNSWING FROM THE HIGH AT 9995. WE ARE SITTING AT THE 38% RETRACEMENT FROM THAT HIGH AT 9844.

THE NEXT LEVEL BELOW THIS IS 23.6% WHICH SITS AT 9906. SO, THESE ARE OUR KEY FIB NUMBERS
9844-DAILY 38%
9806- DAILY 23.6%
9820- 4HR 38%
9806 - 4HR 5O%
9794 -4HR 61.8%

WHEN WE PUT IT ALL TOGETHER WE LOOK FOR THE NUMBERS THAT OCCUR WITH FREQUENCY.
9806 OCCURS 3 TIMES
9820 OCCURS 2 TIMES

THESE 2 NUMBERS ARE OUR KEY NUMBERS. WE WANT TO LOOK FOR A PULLBACK TO ONE OF THESE NUMBERS AND AN INTRADAY PIVOT ABOVE THE NUMBER.

THE LOWER YOU CAN GET IN ON A PIVOT REVERSAL THE SAFER THE TRADE BECAUSE THE CLOSER YOU ARE TO SUPPORT MEAN A LOWER STOP.

AND REMEMBER WHAT I SAID EARLIER TODAY ABOUT THE DIFFERENCE BETWEEN A PULLBACK AND A REVERSAL.

ON THE UPSIDE THE FIRST TARGETS WILL BE IN THE FOLLOWING ORDER.
9842-38%
9870-50%
9900-62%
9931- OPEN OF THE DAILY RANGE BAR.

GBP/USD UPDATE 5-15-2007

CLICK HERE FOR GBP/USD TRADE UPDATE

I WILL BE AWAY FROM MY DESK FOR THE NEXT 4 HOURS. I WILL BE AVAILABLE FOR QUESTIONS AND COMMENTS AT THAT TIME.

JERRY

UPDATE PREGNANT MOTHER 2:17 EST

JUST GOT BULL PIVOT OBOVE BABY'S HEAD ON 15MIN. BAR CLOSED AT 9808.

ENTER LONG=9796 ON PULLBACK TO PIVOT

STOP =9775 (21 PIPS)

TARGET=9850

MARKET WILL TOUCH 9850 BEFORE 9775

2 TO 1 RISK REWARD

JERRY

PREGNANT MOTHER UPDATE 2:00 AM EST

NO ENTRY SIGNAL FOR PREGNANT MOTHER SO DON'T JUMP THE GUN.

WAITING FOR BULL PIVOT ABOVE BABY'S HEAD (9796), ON 15,30,OR 60MIN CHART

jERRY

PREGNANT MOTHER-INSIDE BAR

Now I'd like to better introduce you to the pregnant mother pattern or inside bar.

I will go more in depth about this pattern later but since one is forming right now I wanted you to get a chance to see one before I go into them.

It can be considered an opposite to the outside bar. If the market rises above baby's head you don't have to wait for the close of the pivot bar. In other words it is a heads up to a pivot in progress and can be expected to rise to the top of mother's head for and up bar and the bottom of mothers feet for a down bar. Don't worry the explanation is below.

A nice move usually follows this pattern. Don't trade it just watch it and see how it plays out. Also, the larger the mother the larger the baby and the larger the move.

This is one pivot where you can consider an early entry. Before the close of the pivot bar.

you see on the chart that baby has a range (high and low) that is contained inside mommy's range (high and low). Thus Mom is with child and all that left is for her to give birth. That is for baby to close outside of mommy.

There are only two exceptions for the pivot requirement of the swing bar to have the lowest low or the highest high. You are already familiar with the outside bar exception. The second one is the Harimi (pregnant mother). Harimi is the Japanese word for pregnant. (see your candlestick dictionary)

Once the pivot is formed, baby becomes the swing bar but your stop will be placed below mother or under mother's protection.

If baby has an up close, baby can be expected to break out of mom to the upside. If baby has a down close baby can be expected to break out of mother to the up side.

When the next bar after baby closes above the close of baby(close of bar), you have your pivot bar and baby is the swing bar. Note: Though baby is the swing bar your stop goes below mommy.

If you look to the left of your chart to bar #1 you will see an example of this pregnancy and birth. If you look further up left on your chart to bar#5 you will see an example to the downside.

Like all normal births without complications baby should be expected head first.

When baby's head is down (down close) baby can be expected to be born head first, down. When baby's head is up baby can be expected to be born head first, up.

The entry signal comes when you have a 15,30,or 60min close above the high of baby's head.

So, there you have it. Another of natures workings manifested on the charts.

Jerry

GBP TARGET HIT

THE GBP HIT THE TARGET OF 9787 AT 2:40 PM EST

AT THE TIME OF THIS WRITING IT HAS BOUNCED AS ANTICIPATED WITH A BULL PIVOT ON THE 1HR.

THIS IS NOT TO BE CONSTRUED AS A BUY SIGNAL.

IF WE GET A BULL PIVOT ON THE 4HR THAT WILL BE A SIGNAL THAT THIS MARKET WILL BE PUMPED TO BREAK THROUGH FIB 38%.

YOUR FRIENDLY OPERATORS CUT THIS LEVEL AS INDICATED IN MY EARLIER POST. THIS IS WHAT HAPPENS WHEN THE HERD IS AT A SUPPORT/RESISTANCE LEVEL. NOW THAT MOST OF THE HERD HAS BEEN SHOOK OUT BY THIS DOWN MOVE AND NOT TOO MANY WILL PROFIT FROM THAT 38% LEVEL THE MARKET IS READY TO GO THERE NOW. BUT REMEMBER, ONLY A 4HR BULL PIVOT WILL CONFIRM THIS.

CUTTING SUPPORT/RESISTANCE

Like I stated in my GBP analysis, market makers will cut the target like they did at 38% Fibonacci, when there is high volume at a known support/resistance area and too many small traders will profit.

Know that the major players do not intend for you to profit ever. They've got computers that make your desktop look like a pencil and paper.

They don't have to target you personally, Like the phone systems, and when too many traders will profit, it eats into their profits. Thus, when the level of high volume is approached, (well known support/resistance-the herd), the computerized buy or sell program kicks in.

Many of you might have heard about the computer system called echelon, A.K.A. "THE BEAST", that certain governments use to monitor every single item of electronic communication across the globe.

So, you should not consider it a stretch to conclude that operators who control trillions of dollars in assets have access to similar hardware for you Mr. and Mrs. Herd.

I often get traders who want to debate me about operators and how they don't have time to monitor their itty bitty account and I am some kind of conspiracy nut.Well, reality bites and if you choose to remain willfully ignorant of it, it swallows.

I don't get those debates now since it's been all over the media about these Orwellian systems. But like everything else, that information was available 10 years ago for those who want to know. And it's like many things that I reveal to you, they will also be revealed in the future. But just like it's to late to stop the beast now, it will be too late for the herd then.

And that is why LCM works so well. Because hidden areas of support/resistance levels are revealed to you where the herd knows nothing about. "THE BEAST" skips over you for fatter pickings elsewhere.

Jerry

UPDATE USD/CHF

THE CHF STILL HASN'T SHOWN HER HAND. SHE CLOSED WITH A 4 HOUR BULL PIVOT AT 12:00 AM EST, BUT SHE HIT 3 BAR RESISTANCE ON THE SAME BAR AND BOUNCE OFF PRETTY HARD TO FALL BACK AND CLOSED DOWN TO TEST THE BULL PIVOT ON HIGHER VOLUME.

THE CLOSE OF THE 1HR BAR AT 9:00 AM EST SHOULD REVEAL HER TRUE INTENTIONS.

JERRY.
Email me! click here

TRADE UPDATES

THE EURO/USD HIT THE TARGET STATED IN LAST POST 3557 AT 7:23 AM EST.

THE GBP/USD DID NOT YET CLOSE ABOVE 38% FIBONACCI AS WAS SUGGESTED YOU WAIT FOR CLOSE ABOVE HERE BEFORE ANY LONG ENTRY.

KEPT YOU OUT OF A 47 PIP PULLBACK FROM THE HIGH. DON'T CONSIDER GOING LONG HERE UNLESS WE GET A PIVOT ABOVE 9806.

AND LOOKS LIKE IT WILL TEST 9787 BEFORE IT TRIES TO RESUME ANY UP MOVE. A BULL PIVOT AT THIS LEVEL WOULD BE A SAFER BET.

EURODOLLAR 15 MIN 5-13-07

NOTICE HOW THE 15 MIN FORMED A BULL PIVOT ABOVE 50% FIBONACCI.

NOTICE ON THE 4HR THE CONJUNCTION OF 50% FIB WITH THE TOP OF THE RANGE BAR.

IF YOU ENTERED AT THE CLOSE OF THE 15 MINUTE (PB) WITH HIGHER VOLUME, AS YOU SHOULD HAVE, AT THE PRICE OF 3517 AND PLACED YOUR STOP OH, SAY 6 PIPS BELOW THE LOW OF THE SWING BAR WHICH HAS A LOW OF 3508, THAT WOULD MAKE YOUR STOP 15 PIPS.

THE ULTIMATE TARGET, 4HR 3 BAR, IS 40 PIPS AWAY AT 3557.
THAT'S A REWARD RISK OF 2 1/2 TO 1. WITH HIGH PROBABILITY.

NOTICE HOW THE 4HR PERFORMED A TEXTBOOK CONTINUATION BECAUSE, WELL IT RIGHT OUT OF YOUR TEXT BOOK.

SEE HOW, WHEN YOU STUDY THE TEXT BOOK YOU KNOW WHAT A RANGE BAR IS AND YOU KNOW WHAT A CONTINUATION PATTERN IS YOU KNOW WHAT FIBONACCI IS. THAT'S YOUR FOUNDATION. THAT'S YOUR SKELETON.

NOW I ADDED FLESH TO YOUR SKELETON WITH THE 15 MIN PIVOT ENTRY TECHNIQUE .

I EXPECT THE GBP TO PERFORM A SIMILAR TRICK OFF 38% FIB. THE CHF HAS ALREADY DONE SO OFF OF 50% FIB.

SO NOW, THINK ABOUT THIS. I GAVE YOU 5 FORMAL TRADE CALLS ALL PROFITABLE. I'VE GIVEN YOU AT LEAST THAT MANY INFORMALLY JUST BY SAYING BUY AT THIS LINE OR SELL AT THAT LINE.

SO DO YOU BELIEVE CYCLE MONEY MANAGEMENT IS REALISTIC? DO YOU BELIEVE IN MAJIC? TRADING MAJIC...IF YOU DO NOT YET YOU SHALL MY FRIEND YOU SHALL.

IT'S A WISE TRADER INDEED THAT UNDERSTANDS THAT IT'S NOT JUST ABOUT THE TRADES A SYSTEM GETS YOU INTO, IT IS EVEN MORE VALUABLE FOR THE TRADES IT KEEPS YOU OUT OF.

IF YOU HAVE QUESTIONS YOU WILL BE ASKING WITH SUBSTANCE...A FOUNDATION FROM WHICH YOU CAN SEE...A PEARCH FROM WHICH YOU CAN ACQUIRE VISION.

THE MAN WHO CLIMBS THE TREE NEED NOT BE SMARTER, BECAUSE HE IS HIGHER UP, HE CAN SEE FARTHER.

I...AM...JERRY...THAT...IS...ALL... (LOUD LAUGHTER)

RATIONAL FOR POUND TRADE

SEE ATTACHED CHART

ULTIMATE TARGET IS 3 BAR BUT FIRST AREA OF RESISTANCE IS 9850 BECAUSE OF A CONJUNCTION OF RESISTANCE LEVELS THERE.

MOST TIMES I WILL GIVE YOU THE 1ST LEVEL OF RESISTANCE BUT THAT MAY NOT BE THE ULTIMATE TARGET. MAKE THE MARKET PROVE ITSELF BY CLOSING ABOVE FIB LEVEL, BELOW IS THE TRIPLE CONJUNCTION OF WHICH I SPEAK.

PRIOR BOTTOM, 38% FIBONACCI AND LOW OF PRIOR BEAR PIVOT BAR #4.

IF CLOSE ABOVE FIBONACCI 38% ON HIGHER VOLUME PLAY YOUR CONTINUATION RULES BECAUSE NEXT STOP IS 3 BAR WHERE THERE AWAITS ANOTHER BOTTOM WHICH HAS NOT BEEN TESTED.

IF CLOSE ABOVE THE STATED FIB LEVEL, WAIT FOR A BULL PIVOT BOUNCE OFF THAT LEVEL ON 5 OR 15 MINUTE. THEN PLACE YOUR STOP BELOW THE 5 OR 15 MINUTE SWING BAR OR BELOW 38% FIB, WHICHEVER IS LOWER.

THEN YOU WILL TRUELY BE A SPARROW. DON'T WORRY ABOUT MISSING MOVES. THERE ARE TOO MANY TO SWEAT IT. THAT IS...

IF YOU'RE TRADING "THE LAWS OF CHARTS AND MEN"

JERRY
Email me! click here

TRADE UPDATES FRIDAY 5-11

It appears that I made a mistake in my numbers when I calculated the closing price of Usd/Chf trade. The closing price should have been 2181 which means the trade was actually positive by 7 pips instead of negative 2 pips. I placed the closing price at 2190 instead of 2181. Sorry, That means out of the 5 trades there were 0 losers at the close of Friday's trading.

The updated numbers with more detailed information is at the link provided. I mean, it would probably be a little more helpful if I posted whether it was a long or short entry. Please forgive me for rushing, Once again a case of doing too much to fast.

But it breaks down like this; 5 trades all profitable, no losses. 2 trades would still be open if not for the time stops and they are more profitable at this writing than they were when the time stops were executed.

The trades achieved a roughly 2 to 1 reward to risk when you consider how far price went against you before turning profitable. These were conservative targets as my intent is to get you in the position of playing with house money (profits) then I will get more aggressive when you won't be risking your starting capital. Your winnings can be used for your stops. Then you can take a little more risk.

I have taken this approach because many of you have told me that you are trading mini accounts. That means your objective should be first build up your accout to say, double your initial capital.

118 pips is not a lot for a mini account trader but trading full contracts that's $1,180 in one week. That's why most mini accounts go broke over and over again, because traders feel they have to hit home runs to make it worth their while.

Even though we want trades with a 3 to 1 risk reward you can compound the same way with a 2 to 1. For example; with these 5 trades, if you had added an additional contract after each win you would have earned.

In my next post I'm going to show you how powerful small profits can be.
So, I'm going to give you an example of how money management is the real key to success. It goes hand in hand with trade management. So, look out for that post.

I'm going to use the example of the 5 trades I called for you and how I used compounding to keep my risk next to nothing. I call this my CYCLE APPROACH TO MONEY MANAGEMENT.

In case you are wondering, the original targets for the GBP and the CHF trades are still the same. Just because I don't feel comfortable holding intraday positions over the weekend doesn't mean you have to.

I've just had some bad experiences with gaps against my position with weekend breaking news. You know, like wars, assignation's, death of key political figures, Tsunami, you get my drift.

So, if I think a target is still far enough away to make the trade worthwhile, I will look to reenter the position on the continuation rules and that is the case today Sunday May 13, 2007 with the GBP and the CHF trades.

I will not consider an entry until after the close of the 1hr bar for Monday, which is 9:00 pm est. At that time I will be keeping an eye out for intraday pivots off of Friday's closing prices.

If I reenter I will update you.


CLICK HERE TO SEE LIVE TRADE CALL RESULTS AND STATISTICS.

JERRY
Email me! click here

LIVE TRADE CALL RESULTS

CLICK HERE TO SEE LIVE TRADE CALL RESULTS AND STATISTICS.

JERRY
Email me! click here