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Trading Retracement

Discussion in 'General Forex Talk' started by soloevi, Oct 16, 2007.

  1. soloevi

    soloevi Recruit

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    I need some help on how to trade retracement after a spike using the second trading signal release by Felix for wednesday trading of GPD/USD as an example. If the values released favors a buy signal, for instance, and the price retraces back to where it started before the spike, is it expected that one should place a buy order with the hope that the price would again move up or the order has to be place before the price retraces to the original value where it started before the spike? in which case it becomes a sell order.
     
  2. Snell Lancaster

    Snell Lancaster Recruit

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    this to Soloevi: In my opinion it does not become a sell order. The advice is to buy on a retracement. If I am wrong, someone please let me know!
     
  3. eyeout4u

    eyeout4u Recruit

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    Hello All,

    It seems that if the spike is upwards, that is, a buy order, then the subsequent retracement would be downwards, or a sell order. So if one were to take a position, on the retracement as it goes back to the pre-release market price, then this would be a sell/short order.

    On the otber hand, if the retracement refers to re-tracing the original spike, then this might be interpreted as another buy with the intention of following the market price back up (again) as with the original spike.

    It IS confusing because the signal terminology isn't clearly corroborated with the training video.

    I would think that someone who actually trades with Felix would know how he actually trades this and intends for it to be interpreted.

    Nevertheless, it is fun to trade Felix's signals, so long as this demo account absorbs the money I lose....
    :)
    Kurt
    in Pensacola, Florida
     
  4. manneke

    manneke Private, 1st Class

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    Hi,
    If there is a buy signal, you wait for the spike to retrace and then you buy expecting the price to move up again ( if the retrace indeed happens, some times it just goes up ,or down with a sell signal, and it does not retrace.Then you cannot trade) unless you subscribe to Felix's SNW and you can try to get in just before the spike.
    Happy trading,
    Mannekke Pips
     
  5. JeffNLisa

    JeffNLisa Private

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    I second this question. Or third, I suppose. :)

    Felix THANK YOU THANK YOU for the giving of yourself that you do here.

    If you please, or anyone trading with Felix, the question posted by this thread is a very important understanding if you would spell it out a little clearer. When you said

    my understanding of that was:

    If the top of the hour opened at 2.0342, and when the news came out it spiked to 2.0350 by :04, then :05 closed at 2.0345, you meant to go long at 2.0345.

    Is this the correct understanding?

    Thank you to Felix or anyone who trades with him who knows this for sure--

    Jeff
     

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  6. fl_trader

    fl_trader Recruit

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    When the news is initially released there will often be a spike up or down. Then the price usually retraces (not always). If the spike and retracement does happen they generally happen very quickly. You want to make your trade after the retracement. There is a rule of thumb that says wait for 5 minutes after a news announcement to make a trade to let all the noise settle down.

    If the signal was originally a buy signal then you would wait for the retracement and place your buy order. If a sell signal, the same--you'd wait for the retracement and place your sell order.


    Trying to trade the retracement is devilishly difficult sometimes--it happens fast and depending on your broker the spread may be very wide and their may also be slippage in filling your order.

    One thing you need to take into account are the price levels before the news is released--sometimes the news is already factored in and there's not a lot of activity.
     
  7. richtun

    richtun Recruit

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    Retracement

    I think the question really is when to buy or sell after thye news, should i wait 5mins, or till the market get to a particular price?
     
  8. mp6140

    mp6140 Recruit

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    Mp -- Retracement Trading

    ==============================================

    Well, while its understood to mean trading the reversal off the highs (which would be a short), it can also be taken as trading the initial reversal, and then, after bottoming, trading the secondary run up, which would happen a bit down the road from the original spike, and would be a long !

    enjoy and trade well

    mp
     
  9. Boko Maru

    Boko Maru Sergeant

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    Felix or Sir Pips will always guide these entires in the room, but basically you're waiting for about a 50% retracement to enter (not a hard and fast rule though). So for example, if a price spikes up (a buy) from 50 to 100, then retraces back to 75, you'd go long from there. Doesn't matter that much how many minutes have gone by since the news, main thing is getting the price you want, whether it's been 5 seconds, 5 minutes, whatever.

    But again, just listen to Felix and/or Sir Pips as they guide the trade and you'll learn pretty quickly.
     

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