TraderGav.com

Gav's trading blog - Perseverance, Consistency, Confidence

Gav

The 7-year-old trading blog and new plan

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TraderGav.com is now 7 years old!

After trading and blogging for 7 years, the passion (or addiction!?) is just getting stronger. No sign of stopping. After having a brief hiatus and also working on other project, I have decided to revamp the site, reorganize the content, and redesign the look and feel. Here we have the new TraderGav.com. What do you think? Personally, I totally love it.

TraderGav.com remains my main outlet to share my thoughts, analysis, and trading ideas. Hopefully, materials posted here do help some of you.

I have reorganized the contents of the blog to showcase the important elements (You can view the new sections from Home screen):

Learn Trading

This section consists of the blog posts I have written over the years while I was learning to trade (I am still learning though). I do believe some of these posts provide useful information to new and developing traders.

Trading Tools

This section listed out the posts related to all the trading tools (free tools, or purchase required) I have used and reviewed. It could be software, hardware, trading course or just some random links. I will tell you up front, for some of the products, I am affiliate of them, so I am receiving commission if any readers decided to purchase. But, be assure that, I am not paid to write review for them.

Harmonic Trading

Long time readers might know harmonic patterns are part of my trading strategy. I don’t trade them exclusively, but they are certainly one of the important elements of my trading plan. This section consists of the past posts that I have written related to this subject.

Dummy Collection

Classical section. I started futures trading back in 2006. And this is the first, and most important technique that I have learned. This section lists out the futures trading journals related to Dummy style.

Support and Resistance

This is one of the most important tools in my trading. Here are the posts that related to this subject.

 

Here is what I have in plan for the future development of TraderGav.com :

  • Free weekly newsletter. I love sharing charts and analysis. And I have figured out the more efficient way is to organize my work into a short weekly newsletter. I am still looking for the best way to do this. I am working on setting up a free membership section, but it is work-in-progress. For the time being, the newsletter will be send via email.  If you are interested in receiving the newsletter, please do sign up at the subscription form on the sidebar or mainpage.
  • A sample portfolio. Particularly for swing trading. I will share my trading ideas on the blog and also the newsletter, and track the ideas, manage the trades on the portfolio page. I might or might not hold the position in my live account, but that’s not the point. This section is just to share and hopefully discuss with readers, the techniques to find trading opportunities, and trade management.  The last thing you want in trading and blogging is STRESS. So remember, this is purely educational.

So, here it is. Giving the new life to a 7-year-old trading blog. This is definitely not a website of a trading guru. Instead, a trading blog to share and learn.

Chart Review GOLD (XAUUSD) 17 Jul 2013

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I always prefer to look at GOLD chart at the bigger time frame. It gives me a better picture. Let’s have a look at Spot GOLD (XAUUSD).

Here is the Daily chart of Spot GOLD (XAUUSD). It is trading slightly below 1300 area. My immediate upside target is around the 1337ish which is also the 61.8% Fib retracement with confluence of the upper band of daily channel and previous support turns resistance level.

GOLD D1 17Jul2013
17Jul2013

In the perfect scenario (which rarely happens..), I am looking at the resume of downtrend at the resistance zone mentioned above, and continue moving to complete the 1 to 1 projected movement (as shown in the green lines)

Let’s look into more detailed H4 chart.

A potential harmonic pattern is observed in H4. At the same resistance zone around 1337, as observed from Daily time frame, a bearish Gartley is forming. Although it is important to note 1300 will provide some pretty good support should GOLD break up from here.

GOLD H4 17Jul2013
GOLD H4 17Jul2013

 

That’s it, we have marked down some important levels to watch, and potentially do some businesses. Let’s “wait and see” now.

Technical view of Gold, and long term investment thoughts

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In addition to spot Gold and Silver trading, I have been looking at some long-term Gold investment possibilities. The idea is to apply long-term trend following approach by holding physical Gold (or Silver), while continue short-term speculative trading of these precious metals in spot or futures markets.

According to a report on Bloomberg, Gold price has slumped around 23 percent in the second quarter, the most since at least 2010. Have a look at the monthly chart of spot Gold, while I am not calling the bottom of Gold, a bullish harmonic pattern does seem to be forming now. Just bear in mind that this is a monthly chart, I am just trying to establish a long-term view here.

Gold monthly

During the uncertain times, in general, physical demand of Gold would increase. With my technical view mentioned above, this brings me to the thought of actually investing in some physical Gold. Traditionally, physical gold investments are always exclusive to sophisticated investors. It is very difficult for private individual to find a simple, safe and cost-effective way of buying, storing and selling gold or silver.

However, recently, I’ve come across Bullion Vault, which makes me reconsider about physical Gold or Silver investment.

Bullion Vault enables private individual from all over the world to own professional market gold and keep it in any quantity (investment amount can be as low as $100) in officially recognized bullion vaults in locations around the world.

Having research on the company, Bullion Vault provides a market place with lower dealing spreads comparing to traditional dealing price of gold coins and small bars. In addition to the market place, it also offers low-cost but secured storage options. Investors can choose their prefer storage locations in Zürich, London, New York or Singapore. Bullion Vault offers both Gold and Silver trading and storage facilities.

To me, it is worth spending time looking into this investment option.

 

 

Managing your trade :Exit strategy

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I am not the inventor of this strategy. It is widely available on the internet, and I have no idea who was the originator. I have found it to be effective when using simple support/resistance methodology to manage trades.  

The Simple Exit Strategy

This is an exit strategy using a 5-min chart, however, it can be easily applied to any time frames. The basic idea is to use a lower time frame (about 4 to 6 times lower than the trading time frame) to manage a position and using support resistance to define a better exit. For example, if you are trading the hourly trend, you can apply this strategy in M15/M5 to manage your position. I’ve found this strategy to be useful in my Forex trading.

Rules:

  • When previous resistance becomes support, it is time to consider exiting a SHORT position.
  • When previous support becomes resistance, it is time to consider exiting a LONG position

The EURUSD trade below is a good example to illustrate this strategy. Assuming we entered a short position at 1.27, and the market started to sell off, we decided not to set a hard profit target, instead, we follow the price action to decide when to exit. Looking at the chart below, without a planned strategy, where would you exit? chicken out when there were small price bounces?

Here is the idea. In a downtrend, prices will form lower highs and lower lows. And previous support acts as resistance. By following this principle, we let the profit run until the previous resistance level was violated and becoming a new support level. This signals a potential trend change.

Again, no strategy is perfect, we might still miss out on some even bigger profits. However, in my personal opinion, it is good enough to manage short term position. Have a look at this method.

Below is the hourly chart of USDJPY to illustrate this strategy:

exit strategy chart

The best forex trading strategies are the ones that know when to be aggressive (letting the profitable positions ride) and know when to exit promptly (to cut losses or take profit.) By using the simple concept of support and resistance, traders will be able to map the market and manage a position effectively.

This post was originally written back in 2010. I have updated with an up-to-date chart and refined the strategy.

About the old SIMSCI trading journal

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Just thought I would write a quick post here. Although I have moved to TRADERGAV.com a few years ago, I am keeping my old blog (Better Trading Blog) alive.

The recent change of hosting server has caused some problems , such as loss of images etc of the old blog posts, particularly, the SIMSCI trading journal.

So, if you are looking for my old SIMSCI journal, the old blog is the best place to be. And for your convenience, the address is now simsci.tradergav.com.

Intraday structure of ASX200 26 Feb 2013

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This is not a trade. I thought it might be helpful to post the intraday chart (5-min) of ASX200 index. If one pays enough attention to the chart, it is not too difficult to draw out the structure in terms of supply, demand zones.

First of all, I assume you have the knowledge to identify supply, demand zones. Support , resistance level is just the cluster of supply demand zones. The basis of this analysis is , price tends to rebound at the demand zone (reverse is true for short side), and the broken level tends to serve the opposite.

Have a look at the 5-minute chart below.

ASX200 M5
ASX200 M5