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All the readers of my blog, please tell me about yourself in the comments section, and tell me how you feel about it. It will give me a kick to write more stuff like this.

Thursday, October 7, 2010

applying market logic according to the book written by J. Peter Steidlmayer Interview

applying market logic according to the book written by  J. Peter Steidlmayer Interview
I tried to apply Market logic according to this book today i.e. 7th oct , 2010 in euro-usd fx futures market. I must tell you I am basically a scalper and try to keep my stops of the order of 50-100 dollars.
Live Commentary: market opened at 13919, made a high of 13921, made a low at 13914, then a high of 13919, then a low of 13912, then a high of 13918, then a low of 13907, then a high of 13917, then a low of 13906, then a high of 13917(so far lower lows and lower highs), then a low of 13908 (higher low), then a high of 13927(breached day-high)...after breaching day-high significantly market came down to breached day-low...according to market logic, I should have shorted at breach of day low, which could have given me 15 ticks, then came back to breach day-high...now I should have gone long at breach of day high, but market retraced 11 ticks then went up 100 ticks to make a high at 14022. But was it easy to hold so far...let us see what happened in between13927(the previous high)  and 14022...market breached 13927 for first time in the day and made a high at 13933, then came back to 13917...a trader could go long at 13928, when it breached the market for the first time, or he could wait to go long against 13917 , the low made after first time breaching 13927..but market made a low at 13917 and then made a high at 13930(a lower high)..then made a low at 13911(I think most traders who were long would have cut their losses at breach of 13917 to the downside..but the market breached the current high 13933 after making a low at 13917..I should have bought  immediatelt at breach of hih this time. and this time after breaching day's high market didn't retrace and went straight up to 13980..then made a few lower lows and lower highs..after a final low at 13959, it breached earlier high and made a new high at 13988.The way I would have traded, my profit/ loss would have fluctuated like this till 13988. Had a traded on the basis of this logic.
-25-12+2-4+12-5+11+5-1-4-3-6-3-1
now let us have a closer look at what happened in between 13980 and 13988.

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