The European Sunset 304134
This document was uploaded by user and they confirmed that they have the permission to share it. If you are author or own the copyright of this book, please report to us by using this DMCA report form. Report DMCA
Overview
Download & View The European Sunset 304134 as PDF for free.
More details
- Words: 2,236
- Pages: 5
‘The European Sunset’ A NativeForex Strategy http://www.nativeforex.com *First and foremost remember to practice practice practice this method before using it live, if you decide to do so. There are many brokers that offer free practice accounts. Those accounts will allows you to learn and practice this method Its important to perfect the fundamentals of forex, including the techniques in these strategies before doing any kind of trading. Below I explain this method and how I personally use it effectively. This is for educational purposes only *
Beginning traders and Professional Traders alike have commented on my patterned trend Strategies as TRUE GEMS because of their consistency and ease. It really does eliminate much of the complexity of the forex market when you can trade one time a day with an assured confidence of a particular move in the market. With that said I and a team of professional traders set out about a year ago to look for daily patterns, much like the one in my popular ‘Strangler’ strategy, that could be useful for bringing in some major gains each day. We studied every pair over period of 12 months and looked for patterns that appeared everyday at least 70%-80% of the time, like does ‘The Strangler’. AND AFTER MONTHS OF RESEARCH WE FINALLY FOUND ONE THAT MEETS OUR CRITERIA. Like all my strategies I want to keep this overview of the ‘European Strategy’ as simple as possible. I would contend that much of the failure that traders experience in trading the Forex is due to the fact that they complicate things too much for themselves. Its a FALSE statement to say that the only way to make money is to learn how to analyze complex graphs, etc. Its simply NOT TRUE. I have been successful as a trader and when someone mentions fibonacci numbers or oscillating graphs or some other fancy term,,, I HAVE NO CLUE what they are talking about!!! I have structured the way I trade WITHOUT all that complexity :) That said, In the simplest terms the European sunset can be explained in just a few steps. 1) The forex market is 24 hours a day 6 days a week. The reason it is a 24 hour market is that banks in different parts of the world are moving/functioning at overlapping times, allowing the market to move constantly. There are three major ‘markets’ that move the forex: The Asian Session (or Tokyo session), the American Session (or New York session) and the European session (or London Session) . In order, the Asian session is overlapped by the Euro session, the American session is overlapped by the Asian session, etc. The ‘European Sunset’, more than the name of a strategy, is really descriptive of the kind of movement the market makes at a particular time during the European Session. The whole Euro session begins daily at 2:00am EASTERN and ends at 10:00am EASTERN. Towards either the 2nd half of the Asian session or the 1st part of the
Euro Session day the EUR/USD, the USD/CHY, and the GBP/USD pairs usually find its day’s trend either up or down (Buying/Selling Pressure etc, ) Don’t have access to graphs that will tell you the day’s trend??? Check out the charts offered at http://www.dailyfx.com They’re free and do the job well in telling you the overall trend of each pairs movement each day. When you look at your charts I would recommend using a 60 minute chart as it clearly indicates the trend that you are looking to reverse on. IF THE 60 minute chart is flat use a 30 minute or 15 minute chart to determine the Intraday trend until that 3am timeframe. Now for the secret of the ‘European Sunset’ . . . 2) Something very consistent and defined happens almost daily (usually 70% 80% of the time) at 4:00am EASTERN. THE MAJOR TREND FOR THE DAY REVERSES!!! Lets say the EUR/USD and the GBP/USD are showing dollar weakness and are trending upwards for the day or the USD/CHY trending downwards for the day, quite often at that 4am timeframe that trend will reverse for 1 to 2 hours anywhere from 15 – 30 pips per currency pair!!! There are two ways to take advantage of this trend reversal. 1) You could just put a market order to get into the market at 4am Eastern in the opposite direction from the day’s trend or 2) You can place a limit order several minutes before the 4am timeframe to try to take advantage of the full pip reversal (see ‘Index A’ if you need info on placing a limit order) Please remember that though it can be very easy to capitalize on this consistent daily trend reversal, often the overall trend for the day will most likely pick back up after an hour or two. With that said, don’t be greedy… stick to a 15 – 30 pip gain per pair and then get out In fact it may be wise to use a TTO order (see INDEX ‘B’ for setting Take Profit Targets and setting Stop Losses) when using the Sunset. That way you can set your profit target and not worry about ‘over-staying’ on your trade. 3) There are three currency pairs that are consistent with this reversal: The GBP/USD, EUR/USD, and the USD/CHY. The benefit of using these pairs are the consistent low spreads, allowing for maximum pip gain. You may trade all three currency pairs which would yield an average of 45 –90 pips gain a day on that 4am reversal (based on 15-30 pip average gains per pair) However, if you are a little more conservative you may consider starting with only trading the reversal with the EUR/USD and the USD/CHY. The benefit of these two pairs is that they have a fairly low volatility (in comparison to the GBP/USD) and thus have less of a probability of spiking and stopping you out of your trade (see INDEX ‘B’ for setting Take Profit Targets and setting Stop Losses)
4)SO THERE YOU HAVE IT. The sun ‘sets’ on the major trend of the day on the EUR/USD, GBP/USD, and USD/CHY for 1 to 2 hours. This happens nearly 70%80% of the time NOW,IT WOULD BE great if this happened everyday without fail but OF COURSE there are times when it simply wont reverse. That’s the reality of forex. Nothing 100% predictable. But I contend that with good practice we can pretty close at identifying when it WONT REVERSE and staying out of the trade for the day. With that said since it does reverse 70%-80% of the time,,, if we learn to limit our trades just to that 70%-80%, we should be golden!!! Through my back-testing I have been able to determine 2 things that seem to cause NO reversal to happen some days at 4am EASTERN 1) NEWS Breaks!!! NEWS breaks can be highly volatile and quite often may cause the trend to continue strongly in its direction without reversing. NEWS MAY ALSO cause the market to move strongly in one direction for good time before the opening of the Euro Session then sometimes the market seeks to balance itself out during the rest of the day. This may result in no reversal at 4am. the reversal seems to be the most common during lower to moderate volatility. If you don’t know where to see when news breaks checkout http://www.forexfactory.com/ They have all the scheduled news times for the week as well as a volatility indicator which forecasts how strongly a news release will affect the market. 5) Start using this method by paper-trading. Do your research in terms of news breaks etc and PRACTICE PRACTICE PRACTICE!!! After practice with this method, youll find your success rate way above 70%. With the proper win/loss ratio you are surely to be lucrative in your trading!!! (see INDEX ‘B’ for setting Take Profit Targets and setting Stop Losses) I hope this strategy will work well with you. PLEASE KNOW THAT THIS OVERVIEW IS ONLY THE BEGINNING OF LEARNING THE STRATEGY. PLEASE FEEL FREE TO CONACT ME FOR SUPPORT I PERSONALLY USE ALL OF THESE STRATEGIES IN MY EVERYDAY TRADING ROUTINE AND THUS I AM ALSO CONSTANTLY LEARNING MORE AND MORE ABOUT THE MARKET. I WILL UPDATE YOU ON ANY NEW INSIGHTS I HAVE SUPPORT FOR THE EUROPEAN Sunset I always try to keep my strategies short and simple. Its FALLACY to assume that forex strategies need to be complicated to work. That simply is NOT true. However if you have questions feel free to contact me. You have a lifetime of support with this technique. Good Luck with your trading. REMEMBER THAT THIS IS JUST THE BEGINNING OF LEARNING THIS STRATEGY. PLEASE FEEL FREE TO CONTACT ME ANY TIME FOR SUPPORT IM HERE FOR YOU
INDEX ‘A’ ‘Limit Order’ A limit order is often used when choosing a take profit target on an active trade. (For ex. Lets say you have a trade going long which you entered at 1.1220, you might set a limit order on that trade to SELL at 1.1228, if your trade reaches 1.1228, the order will trigger and sell you out for a gain of +8 pips) In that sense, you probably already know what a Limit order is. THERE IS another important way that you can use limit order which is less understood but still very powerful. . . Lets say you see the market for the USD/CAD at 1.1320 moving slightly upward (bullish trend) to 1.1321, 1.1322 ,etc. and based on some sort of chart analysis you suspect that soon this trend will go as high as 1.1326 and then reverse and go the opposite way. YOU COULD use a LIMIT ORDER here to tell your broker to ENTER YOU INTO the market going SHORT when the market rises to 1.1326. So by setting this order you are speculating that the market will reach 1.1326 and then go down from there. So if your limit order sell triggered when the market went up to 1.1326 and then it dropped to 1.1305, you would have gained 21 pips!!!! THIS IS THE WAY THAT IT CAN BE USED WHEN DOING THE EUROPEAN SUNSET. Get it? If not please email me and ill try to explain it more or you may contact your broker and ask them how limit orders work. Good brokers have good customer support that will be more than glad to explain INDEX ‘B’ ‘Stop Losses and Take Profit Targets’ EACH individual trader has different tolerance levels to risk in their trading. And thus giving specific Entry/Stop/Take Profit specs to each strategy would seem to force each trader into one particular style of trading. Each of my strategies, I believe, is usable with several different trading styles as well as with those with different risk tolerances. I can share what I personally use as a measure for Stop Losses and Take Profit Targets. I use a 1 to 1.5 win/loss ratio in most of my trades. What this means is that whatever my pip goal is per trade I willing to risk that amount divided by 1.5. So If im looking to gain 30 pips on a trade I would be willing to risk 20 pips on that trade, etc… with this ratio I have faired well in my trading. OF COURSE there are times when I stray from this ratio. Most often when trading during highly volatile times or when trading highly volatile pairs like the GBP/USD, I often give myself a little more room on the risk end of my trade. The reason being is that volatile times cause the market to often spike up and down while pushing in one direction. A NEWS break may cause the USD to rocket with strength and while the EUR/USD plummets downward it may spike up 20, 30,40 pips before giving true downward direction.
One good way to manage a trade is to use a TTO order. A TTO allows to place both a STOP LOSS and a TAKE PROFIT TARGET at the same time. This can be helpful to ensure your trade will execute you out of the trade speedily if you hit your target or if you hit your stop loss. REMEMBER! KEEP IT SIMPLE, STAY CONSISTENT, AND BUILD YOUR WEALTH!! *Disclaimer* Forex Trading involves a high risk of loss. The strategies and analysis shared here do not guarantee results. Each person who uses these kinds of strategies may have varying This Strategy or Chart Analysis is NOT TRADING ADVICE. EACH TRADE IS YOUR OWN DECISION It is simply an review of the back-testing that has been done during personal trading sessions. . Any analysis or strategies posted are personal opinions based on personal experience. Unique experiences and past performances do not guarantee future results. This strategy or chart analysis is for educational purposes only and exist to help other forex traders to come to a better understanding of charts and forex software. No buy. sell, or hold recommendations will be given on through NativeForex. This Strategy is being offered as information only. There is no guarantee of success. The author/publisher specifically disclaims any personal liability, loss, or risk incurred, as a consequence of acting on any information presented in this document. THE EUROPEAN SUNSET IS INTELLECTUAL PROPERTY OF NATIVEFOREX AND MAY NOT BE REPRODUCED TO PUBLISH.
Beginning traders and Professional Traders alike have commented on my patterned trend Strategies as TRUE GEMS because of their consistency and ease. It really does eliminate much of the complexity of the forex market when you can trade one time a day with an assured confidence of a particular move in the market. With that said I and a team of professional traders set out about a year ago to look for daily patterns, much like the one in my popular ‘Strangler’ strategy, that could be useful for bringing in some major gains each day. We studied every pair over period of 12 months and looked for patterns that appeared everyday at least 70%-80% of the time, like does ‘The Strangler’. AND AFTER MONTHS OF RESEARCH WE FINALLY FOUND ONE THAT MEETS OUR CRITERIA. Like all my strategies I want to keep this overview of the ‘European Strategy’ as simple as possible. I would contend that much of the failure that traders experience in trading the Forex is due to the fact that they complicate things too much for themselves. Its a FALSE statement to say that the only way to make money is to learn how to analyze complex graphs, etc. Its simply NOT TRUE. I have been successful as a trader and when someone mentions fibonacci numbers or oscillating graphs or some other fancy term,,, I HAVE NO CLUE what they are talking about!!! I have structured the way I trade WITHOUT all that complexity :) That said, In the simplest terms the European sunset can be explained in just a few steps. 1) The forex market is 24 hours a day 6 days a week. The reason it is a 24 hour market is that banks in different parts of the world are moving/functioning at overlapping times, allowing the market to move constantly. There are three major ‘markets’ that move the forex: The Asian Session (or Tokyo session), the American Session (or New York session) and the European session (or London Session) . In order, the Asian session is overlapped by the Euro session, the American session is overlapped by the Asian session, etc. The ‘European Sunset’, more than the name of a strategy, is really descriptive of the kind of movement the market makes at a particular time during the European Session. The whole Euro session begins daily at 2:00am EASTERN and ends at 10:00am EASTERN. Towards either the 2nd half of the Asian session or the 1st part of the
Euro Session day the EUR/USD, the USD/CHY, and the GBP/USD pairs usually find its day’s trend either up or down (Buying/Selling Pressure etc, ) Don’t have access to graphs that will tell you the day’s trend??? Check out the charts offered at http://www.dailyfx.com They’re free and do the job well in telling you the overall trend of each pairs movement each day. When you look at your charts I would recommend using a 60 minute chart as it clearly indicates the trend that you are looking to reverse on. IF THE 60 minute chart is flat use a 30 minute or 15 minute chart to determine the Intraday trend until that 3am timeframe. Now for the secret of the ‘European Sunset’ . . . 2) Something very consistent and defined happens almost daily (usually 70% 80% of the time) at 4:00am EASTERN. THE MAJOR TREND FOR THE DAY REVERSES!!! Lets say the EUR/USD and the GBP/USD are showing dollar weakness and are trending upwards for the day or the USD/CHY trending downwards for the day, quite often at that 4am timeframe that trend will reverse for 1 to 2 hours anywhere from 15 – 30 pips per currency pair!!! There are two ways to take advantage of this trend reversal. 1) You could just put a market order to get into the market at 4am Eastern in the opposite direction from the day’s trend or 2) You can place a limit order several minutes before the 4am timeframe to try to take advantage of the full pip reversal (see ‘Index A’ if you need info on placing a limit order) Please remember that though it can be very easy to capitalize on this consistent daily trend reversal, often the overall trend for the day will most likely pick back up after an hour or two. With that said, don’t be greedy… stick to a 15 – 30 pip gain per pair and then get out In fact it may be wise to use a TTO order (see INDEX ‘B’ for setting Take Profit Targets and setting Stop Losses) when using the Sunset. That way you can set your profit target and not worry about ‘over-staying’ on your trade. 3) There are three currency pairs that are consistent with this reversal: The GBP/USD, EUR/USD, and the USD/CHY. The benefit of using these pairs are the consistent low spreads, allowing for maximum pip gain. You may trade all three currency pairs which would yield an average of 45 –90 pips gain a day on that 4am reversal (based on 15-30 pip average gains per pair) However, if you are a little more conservative you may consider starting with only trading the reversal with the EUR/USD and the USD/CHY. The benefit of these two pairs is that they have a fairly low volatility (in comparison to the GBP/USD) and thus have less of a probability of spiking and stopping you out of your trade (see INDEX ‘B’ for setting Take Profit Targets and setting Stop Losses)
4)SO THERE YOU HAVE IT. The sun ‘sets’ on the major trend of the day on the EUR/USD, GBP/USD, and USD/CHY for 1 to 2 hours. This happens nearly 70%80% of the time NOW,IT WOULD BE great if this happened everyday without fail but OF COURSE there are times when it simply wont reverse. That’s the reality of forex. Nothing 100% predictable. But I contend that with good practice we can pretty close at identifying when it WONT REVERSE and staying out of the trade for the day. With that said since it does reverse 70%-80% of the time,,, if we learn to limit our trades just to that 70%-80%, we should be golden!!! Through my back-testing I have been able to determine 2 things that seem to cause NO reversal to happen some days at 4am EASTERN 1) NEWS Breaks!!! NEWS breaks can be highly volatile and quite often may cause the trend to continue strongly in its direction without reversing. NEWS MAY ALSO cause the market to move strongly in one direction for good time before the opening of the Euro Session then sometimes the market seeks to balance itself out during the rest of the day. This may result in no reversal at 4am. the reversal seems to be the most common during lower to moderate volatility. If you don’t know where to see when news breaks checkout http://www.forexfactory.com/ They have all the scheduled news times for the week as well as a volatility indicator which forecasts how strongly a news release will affect the market. 5) Start using this method by paper-trading. Do your research in terms of news breaks etc and PRACTICE PRACTICE PRACTICE!!! After practice with this method, youll find your success rate way above 70%. With the proper win/loss ratio you are surely to be lucrative in your trading!!! (see INDEX ‘B’ for setting Take Profit Targets and setting Stop Losses) I hope this strategy will work well with you. PLEASE KNOW THAT THIS OVERVIEW IS ONLY THE BEGINNING OF LEARNING THE STRATEGY. PLEASE FEEL FREE TO CONACT ME FOR SUPPORT I PERSONALLY USE ALL OF THESE STRATEGIES IN MY EVERYDAY TRADING ROUTINE AND THUS I AM ALSO CONSTANTLY LEARNING MORE AND MORE ABOUT THE MARKET. I WILL UPDATE YOU ON ANY NEW INSIGHTS I HAVE SUPPORT FOR THE EUROPEAN Sunset I always try to keep my strategies short and simple. Its FALLACY to assume that forex strategies need to be complicated to work. That simply is NOT true. However if you have questions feel free to contact me. You have a lifetime of support with this technique. Good Luck with your trading. REMEMBER THAT THIS IS JUST THE BEGINNING OF LEARNING THIS STRATEGY. PLEASE FEEL FREE TO CONTACT ME ANY TIME FOR SUPPORT IM HERE FOR YOU
INDEX ‘A’ ‘Limit Order’ A limit order is often used when choosing a take profit target on an active trade. (For ex. Lets say you have a trade going long which you entered at 1.1220, you might set a limit order on that trade to SELL at 1.1228, if your trade reaches 1.1228, the order will trigger and sell you out for a gain of +8 pips) In that sense, you probably already know what a Limit order is. THERE IS another important way that you can use limit order which is less understood but still very powerful. . . Lets say you see the market for the USD/CAD at 1.1320 moving slightly upward (bullish trend) to 1.1321, 1.1322 ,etc. and based on some sort of chart analysis you suspect that soon this trend will go as high as 1.1326 and then reverse and go the opposite way. YOU COULD use a LIMIT ORDER here to tell your broker to ENTER YOU INTO the market going SHORT when the market rises to 1.1326. So by setting this order you are speculating that the market will reach 1.1326 and then go down from there. So if your limit order sell triggered when the market went up to 1.1326 and then it dropped to 1.1305, you would have gained 21 pips!!!! THIS IS THE WAY THAT IT CAN BE USED WHEN DOING THE EUROPEAN SUNSET. Get it? If not please email me and ill try to explain it more or you may contact your broker and ask them how limit orders work. Good brokers have good customer support that will be more than glad to explain INDEX ‘B’ ‘Stop Losses and Take Profit Targets’ EACH individual trader has different tolerance levels to risk in their trading. And thus giving specific Entry/Stop/Take Profit specs to each strategy would seem to force each trader into one particular style of trading. Each of my strategies, I believe, is usable with several different trading styles as well as with those with different risk tolerances. I can share what I personally use as a measure for Stop Losses and Take Profit Targets. I use a 1 to 1.5 win/loss ratio in most of my trades. What this means is that whatever my pip goal is per trade I willing to risk that amount divided by 1.5. So If im looking to gain 30 pips on a trade I would be willing to risk 20 pips on that trade, etc… with this ratio I have faired well in my trading. OF COURSE there are times when I stray from this ratio. Most often when trading during highly volatile times or when trading highly volatile pairs like the GBP/USD, I often give myself a little more room on the risk end of my trade. The reason being is that volatile times cause the market to often spike up and down while pushing in one direction. A NEWS break may cause the USD to rocket with strength and while the EUR/USD plummets downward it may spike up 20, 30,40 pips before giving true downward direction.
One good way to manage a trade is to use a TTO order. A TTO allows to place both a STOP LOSS and a TAKE PROFIT TARGET at the same time. This can be helpful to ensure your trade will execute you out of the trade speedily if you hit your target or if you hit your stop loss. REMEMBER! KEEP IT SIMPLE, STAY CONSISTENT, AND BUILD YOUR WEALTH!! *Disclaimer* Forex Trading involves a high risk of loss. The strategies and analysis shared here do not guarantee results. Each person who uses these kinds of strategies may have varying This Strategy or Chart Analysis is NOT TRADING ADVICE. EACH TRADE IS YOUR OWN DECISION It is simply an review of the back-testing that has been done during personal trading sessions. . Any analysis or strategies posted are personal opinions based on personal experience. Unique experiences and past performances do not guarantee future results. This strategy or chart analysis is for educational purposes only and exist to help other forex traders to come to a better understanding of charts and forex software. No buy. sell, or hold recommendations will be given on through NativeForex. This Strategy is being offered as information only. There is no guarantee of success. The author/publisher specifically disclaims any personal liability, loss, or risk incurred, as a consequence of acting on any information presented in this document. THE EUROPEAN SUNSET IS INTELLECTUAL PROPERTY OF NATIVEFOREX AND MAY NOT BE REPRODUCED TO PUBLISH.
