Tuesday, January 10, 2006

Happy New Year! THT Big Weekend Edition Part One

We hope you all had a great holiday, and may this year be your best ever in the markets!

Traders Helping Traders was closed or running at half mast for part of November and most of December, as Erich had a special wedding to attend in Mexico, and of December is a squirrely month to trade because of the holidays.

Here is the Test Drive version of the THT Big Weekend Edition. Remember, these are delieverd BEFORE the fact to members, and in their complete and voluptuous form - no omissions, no chopping and fresh off the presses complete with charts:


The beginning of the year is usually the time when I begin to take stock of what we've been doing here at Traders Helping Traders to see if there are any improvements that need to be made. Your feedback is extremely important to us. Your input and suggestions continue to help us refine the publication to be the best of its kind any where, on the internet and off, and I wanted to say a big "Thank You" for that!

This is why I'm always encouraging you to make suggestions about changes you would like to see. Is there something that bugs you about what we're doing? Let me know, maybe we can do something about it. Your concerns and opinions do matter to us!

One theme that has recurred since we began publishing is that you want more guidance with your analysis and your trades. We've continued to adjust the format to try and meet this need, but this week we're taking it to the ultimate level. For the first time since we began publishing in 2002 I'm making myself available for one to one mentoring!

That's right, now you can pick my brain and have my undivided attention for as long as you like regarding anything about trading that is giving you problems:
  • Are you day trading and you want to get a better handle on the markets? I'm there.

  • Do you want to learn the Bond trading strategy? I'll teach you.

  • Are you position trading but having a hard time dissecting the charts and picking the best trades? I can help.

  • Are you having trouble pulling the trigger on a trade? Let me help you work through it.

Best of all, it's live, one to one and interactive. You can work at your own pace and ask me anything you need to. Short of us being in the same room together I can think of no better way for you to learn to trade the markets!

The mentoring can be as short as a single day or for as long as you like, and we will work at whatever time and pace works best for you. Cost of the program will depend on your needs and focus as a trader (ie. day trading vs. position trading) so please drop me an email if you're interested ([email protected]) for more particulars.

One last item about the program, unlike the other features we offer at Traders Helping Traders, this will not be an ongoing program but will only be offered from time to time. So if you are interested I urge you to write me today to reserve a spot.

I'm looking forward to working with you!

Enjoy this week's issue,

[email protected]

Currencies Market Overview

The currencies were a touch disappointing last week. While I have to admit I was a little gun-shy about trading the large ranging markets after the holiday break we saw some pretty impressive moves in many of the markets. Before the weekend committed the ultimate trading faux pas and tried to predict what the markets would do instead of trading the obvious resistance that had formed on Thursday.

The end result? I missed a major move in almost all the currencies because of my hesitation. Not all got away however as we did manage to peg the Yen for a substantial gain. Now that the move is underway we need to be on the alert for the next chance to enter the markets. Fortunately many are trading at/near significant support and resistance, so we may not have to wait too long. If you draw trendlines and Fib levels on many of the currency charts you'll better see the resistance I'm referring to. Any setback is likely to be short term however, so keep a lookout for a chance to re-enter the market with the trend and not against it!

Japanese Yen

The Japanese Yen was the "superstar" market last week as Friday's session easily found our entry, and came within 10 ticks of our first profit target, all in one session! Now that we are in this market however the nail biting beings, especially with over a $1000 in profit per contract as of the close!

Where you want to bring your stops for Monday really depends on your attitude and depth as a trader. If you are a small trader I would suggest getting those stops pretty darn tight, probably just under the 8800 and try to squeeze the market into either stopping you out, or hitting your profit target; thereby maximizing your profit for the short term.

If you're less risk adverse, and don't mind seeing some of those hard earn profits potentially disappear, then you might consider a looser stop, something under the intraday support at 8770 – 8780 perhaps? This will still preserve the majority of your profit while allowing you to keep a more favourable risk to reward ratio (although not a 3:1 RRR).

Believe it or not, the best stop placement for the trade, theoretically speaking, is at breakeven; however I'm afraid that I don't have the nerve for that, not with this much money at stake!

While the Yen's trend is strong, and building, and while I do believe the Yen will trade higher still, we are also trading at a bundle of resistance near the 50% level. What this means is that we could see a bounce going into Monday. On the upside, the Yen is predisposed to gapping, so with a bit of luck we could see the market gap higher which would make all our deliberation moot, but all we can do as traders is prepare for what is likely to happen and that means bringing in our stops.

Continuation of Long March Japanese Yen from 8711
Exit Order: 8767, 8777 or 8797 – you choose
Approximate Risk Exposure: $0 per contract
Profit Target: 8837 followed by 8919
Approximate Potential Profit: $1575 per contract
RRR: n/a
Degree of Risk: Moderate to HIGH

The Japanese Yen Chart is included in the full version, along with all the other markets covered, Erich's Chartbook , Pick of the Letter, the Lessons and Homework Assignments, plus much more.

To get yours, go to

Part Two, Tom's Trades, to follow.