*** Note this post was subsequently addended below 28th April 2016 , by Clive Lamberts,email response which I have shared, along with my reply. It is my belief he is a decent man, with good intentions, as far as it is even my place to comment. However my criticisms of the particular trade in question remain. ***
If ever you elect to take ‘another’ man’s trade, beware of the following, you are:
- abdicating your responsibility for managing your own money to someone else, it is an act usually bereft with laziness, blind faith and is fundamentally disempowering.
- setting yourself up for potential ‘victimhood’ for when things go wrong, which externalises your locus of control, rather than internalising it and empowering yourself.
- neutering at the fetal level your experience of a possible learning event.
- highlighting your own lack of priority for building your own wealth and taking responsibility for the process.
- only to blame if you lose.
If you are just out for ideas and experiences in the ‘early doors’ phase of your journey, that is what you will get and you will pay for it too.
Always ask what incentives may exist for those putting forward ideas, are they representing a broker and generating trades.
Are they really committed to winning ideas or just the ‘churn’. In all cases, it is not implied that those examined here are or are not doing such.
- do they love what they do, would they do it if even not paid to do it?
- have they provided detail, justification and sufficient clarity for the reasons for the trade?
- tied in anyway, or receiving other income for their work where a 3rd party [Broker may have an interest for them to support, that may not necessarily be aligned to your interests [making money]
- If Technical in approach:
- How much of the chart based analysis detail have you been given?
- Do they rely on derived formula based indicators a lot?
- Are they trading reversals [calling Bottoms/Tops]?
- Have they done Multi Time frame analysis?
- Have they done any Intra-Market Analysis comparing elements of the FX pair against other majors to assess general relative strengths and weaknesses?
- Do you get the impression they enjoy charting, are there annotations, lots of analysis, with all historical key levels of significance, prior patterns highlighted, explanatory annotations, or are they relatively ‘unillustrated’ canvas and its just a quick means to an end for making money? [have they invested in annotation software & used it, are there a lot of detailed draws on the chart. technical Analysis is analysing the past for information on what the future may hold]
- Do they draw ‘patterns’ and do they really get them.
- Is the trade idea very ‘tactical’, light on big detail just for the ‘quick scalp’?
- What Risk to Reward are they proposing especially when valued at the outset, not after later trails on assumed success.
A 940 pip initial Long stop? for a 45 & 125 pip split gain…
Very ‘Flat shouldered’ Inverted Head & Shoulders with weak grinds after steep selling, and a quick dip & bounce head?
Or continuation as most things are most of the time, In this case a Weak Grinding Rising Wedge.
More downside the Euro is my probability based assessment until our flat bottomed RL3 is in then a weak rally for a Global Macro Timeframe continuation pattern, see these below.
Our bigger time frame analysis.
Monthly chart EURUSD
At the point of our short entry 1.1126, S/L 1.1372, The RRR to TGT 0.9570 is 246: 1576 or 1:6.41
Watch the video of their proposition for the trade here from Ian Coleman & Clive Lambert of First4Trading.net and FuturesTechs.co.uk respectively.
The EURUSD buyers..
*** ADDENDUM ***
I received further detail from Clive Lambert on his suggested trade.
Plaudits to him for taking the time to elaborate. As he has not had a voice in this discussion, I have added his response in an email with my reply.
On 2 Mar 2016, at 11:42, Clive Lambert <firstname.lastname@example.org> wrote:
Dear Sir. To answer your questions on your Blog:
competent, – FuturesTechs is an FCA registered company.
I have 30 years market experience. I have been writing about charts for 15 years, am a Board member of the UK Society of Technical Analysts, and a tutor on their Diploma Course for the last 10 years. I have also spoken at the annual IFTA conference. I have also written a book on Candlestick Charts. I can send you a copy if you like?!
Do they love what they do, would they do it if even not paid to do it? –
I DO get paid for what I do, yes. My work for the STA as a board member is voluntary, so I guess that answers both of your questions?
Have they provided detail, justification and sufficient clarity for the reasons for the trade? –
The “brief” for the trade idea that you’ve highlighted is to keep is “short and sweet”. I provide deeper insight to my clients on a daily basis (subscription service) on 25+ markets daily.
tied in anyway, or receiving other income for their work where a 3rd party [Broker may have an interest for them to support, that may not necessarily be aligned to your interests [making money] – I do not get paid on any kind of “commission per trade idea” basis. To add some colour to this please see this post on Trading Floor yesterday when I basically said “don’t bother trading if the chart isn’t clear”…
If Technical in approach:
How much of the chart based analysis detail have you been given? – See above. Also I actually believe that my job as a technician is to make reading and explaining charts easier and less “noisy” and this approach has always served me well.
Do they rely on derived formula based indicators a lot? – Do you mean things like RSI and MACD? I use them as extra confirmation… I do not rely on any one “strand” of Technical Analysis on a “stand-alone” basis and wouldn’t recommend it to anyone!
Are they trading reversals [calling Bottoms/Tops]? – I generally favour a trend following approach but do look for patterns for tops and bottoms. I also find that lots of people don’t seem to have done their homework when talking chart patterns and there is lots of bad analysis out there. I would suggest people take the STA Course to LEARN from Pros…
Have they done Multi Time frame analysis? – Yes. All the time. But I may not include it on something like “traders tale” on Saxo TV. Again for the sake of clarity I try to keep things simple. Doesn’t mean I’m not doing a proper analysis myself before suggesting trade ideas or offering directional skew.
Have they done any Intra-Market Analysis comparing elements of the FX pair against other majors to assess general relative strengths and weaknesses? – Yes. 30 years of market experience as well…
Do you get the impression they enjoy charting, are there annotations, lots of analysis, with all historical key levels of significance, prior patterns highlighted, explanatory annotations, or are they relatively ‘unillustrated’ canvas and its just a quick means to an end for making money? [have they invested in annotation software & used it, are there a lot of detailed draws on the chart. technical Analysis is analysing the past for information on what the future may hold] – As per the above I find an “uncluttered” chart to be more effective a lot of the time to try to illustrate a point. And yes I DO enjoy looking at charts and imparting (hopefully!) “wisdom” thereon.
Do they draw ‘patterns’ and do they really get them. – Yes and yes!
Is the trade idea very ‘tactical’, light on big detail just for the ‘quick scalp’? – I suggest trades with different time frames. The one you highlighted was one of my simpler, shorter term ideas… I think there is room for all styles of trading…
What Risk to Reward are they proposing especially when valued at the outset, not after later trails on assumed success. – The trade you highlighted for attention had a reward/risk of 2:1. Not ideal but good enough. I cannot speak for Mr Coleman but I’d say his one was a typo/error. I think it is good that you are highlighting Reward/risk to your readership as it is vitally important.
If you have any other questions please let me know. I am happy if you want to publish this response. In fact I hope you do!
My reply –
Just seen this as an email forward failed.
I will add your comments to the original post in fairness to you, so that any critique has more understanding of where you were coming from and the purity of intention.
As someone who has written a book on candlestick charting I found the Inverted H&S pattern element of the call, not of particularly high standard as stated and remain of that opinion, especially for a relative low timeframe, but others can determine for themselves if they agree.
I understand however that a persons general competence is not subject to one particular trade idea where they may have had limited scope to share their full case, but personally I try encourage followers to be specialists and to be process driven on every assessment and aware of the larger timeframes ‘lean’ on any tactical idea, or be explicit if deviating from usual practice.
As a small point the Intramarket analysis comment, was in reference to looking at the expected weak side of the pair against other majors and the expected stronger half likewise against other majors for additional technical confirmation. Not tenure of trading the markets, I have come across long tenure technicians, with long educational careers on the general theory, that are no closer to constructing, a specialist approach.
This aside your response is noted and will be add ended to the post and clip.
I am not a fan, of Indicator usage generally [a select few exclusions, from Volume and their derivatives, Advance/Decline on Indices, the Pinch in Bollinger bands etc..] and whilst once a member of the STA, I find the degree of prevalence indicators have in the theoretical study of TA overstates its usefulness.
The confirmation claimed, is merely a derived restatement in a different format, of that already prevalent in the price behaviour. Indicators lag, as we both know, and even aspects of divergence, are subject to rate of change elements of the price behaviour, which is visible in the price behaviour itself, without taking the eye away from the price print. Indicators by their nature of ‘alleging’ overbought or oversold conditions, encourage countertrend trading, bottom & top calling.
That is largely counterproductive, especially for a new/Intermediate traders, who may place too great an emphasis on computer generated lines that lag. These views are criticism of theoretical TA in general, rather than your trade share, and it was noted you downplayed to ‘secondary’ the role they served.
Thank you for the response.