Technical Indicators for Range Bound FOREX Trading

Expert:  Wayne McDonell, Chief Currency Coach, FxBootcamp.com 

Topics that will be covered for above session are: 

•    Support & Resistance
•    Pivot Points
•    Bollinger Bands
•    Candlestick Patterns

Who is Wayne McDonell?

Wayne McDonell is a professional FOREX trader with an Entrepreneurial spirit and a business leader's mind. He trades his own funds and trains others how to do so consistently and profitably by coaching them everyday... in the live FOREX markets. No signals or alerts are provided. Only trade planning and execution that suits the individual trader's style, comfort and risk tolerance.

Mr. McDonell has coached hundreds of entrepreneurs and executives. He has spoken at dozens of conferences around the world. He's held several senior management roles at companies from 2 - 2000 employees, including Cicso Systems and Apple Computers. As a venture capitalist,
he as invested in over 100 consumer and industrial patents. Mr.McDonell has appeared in many publications including Inc Magazine,
TechWeek, Information Week, The National Post, as well as others in Europe and Asia.

Mr. McDonell's passion is FOREX. He currently mentors currency traders who are preparing to trade currency as a career. Future plans include a book and seminar tour.

Session Material

FXstreet Moderator (Jun 20, 2006 9:26:31 AM)
Good morning, good afternoon, and good evening to all of you joining us today from different parts of the world. Welcome to today's Live Forex Expert Question and Answers session.

FXstreet Moderator (Jun 20, 2006 9:45:36 AM)
Welcome to FXstreet.com Q&A Forex Session. Today’s session will start in 5 minutes.

FXstreet Moderator (Jun 20, 2006 9:51:50 AM)
Thank you for joining today’s Q&A Session

FXstreet Moderator (Jun 20, 2006 9:52:22 AM)
Welcome to the Session. Today I am delighted to welcome our guest speaker Wayne McDonell, Chief Currency Coach, FxBootcamp.com

Wayne McDonell - FxBootcamp (Jun 20, 2006 9:53:01 AM)
Hello everyone,

Wayne McDonell - FxBootcamp (Jun 20, 2006 9:53:11 AM)
It’s a pleasure to present at FXstreet’s Expert Q&A session.

Wayne McDonell - FxBootcamp (Jun 20, 2006 9:53:25 AM)
I’d like to thank everyone at FXstreet for the invitation.

Wayne McDonell - FxBootcamp (Jun 20, 2006 9:53:33 AM)
It’s a wonderful opportunity to dive into a wide range of issues effecting FOREX traders.

Wayne McDonell - FxBootcamp (Jun 20, 2006 9:53:42 AM)
I thank you for joining me today. I know you have invested an hour of your time to attend.

Wayne McDonell - FxBootcamp (Jun 20, 2006 9:53:54 AM)
Let’s begin.

Wayne McDonell - FxBootcamp (Jun 20, 2006 9:54:02 AM)
Do you know the old cowboy song “Home on the Range”?

Wayne McDonell - FxBootcamp (Jun 20, 2006 9:54:11 AM)
I’ve taken the liberty to make a few minor changes to the lyrics

Wayne McDonell - FxBootcamp (Jun 20, 2006 9:54:19 AM)
so they appropriate for trading FX in a range bound market…

Wayne McDonell - FxBootcamp (Jun 20, 2006 9:54:26 AM)
which is the topic of today’ presentation.

Wayne McDonell - FxBootcamp (Jun 20, 2006 9:54:36 AM)
“Home, home on the range. Where the bulls and the bears like to play. Where seldom is heard a encouraging word. And the charts are not changing all day.”

Wayne McDonell - FxBootcamp (Jun 20, 2006 9:54:55 AM)
Welcome to:

Wayne McDonell - FxBootcamp (Jun 20, 2006 9:55:02 AM)
Technical Indicators for Range Bound FOREX Trading

Wayne McDonell - FxBootcamp (Jun 20, 2006 9:55:21 AM)
Before we can discuss how to trade a range bound market.

Wayne McDonell - FxBootcamp (Jun 20, 2006 9:55:46 AM)
Let’s discuss what a range market is not.

Wayne McDonell - FxBootcamp (Jun 20, 2006 9:55:57 AM)
A range market is NOT in a trend.

Wayne McDonell - FxBootcamp (Jun 20, 2006 9:56:06 AM)
So what is a trending market?

Wayne McDonell - FxBootcamp (Jun 20, 2006 9:56:16 AM)
It’s a market that is making a series of higher high and higher lows. (An up-trend market)

Wayne McDonell - FxBootcamp (Jun 20, 2006 9:56:26 AM)
Or it’s a market that is making a series of lower highs and lower lows. (A down-trend market)

Wayne McDonell - FxBootcamp (Jun 20, 2006 9:56:35 AM)
Therefore, by process of deduction, a range-bound market must be a series that is not an up-trend or a down-trend market.

Wayne McDonell - FxBootcamp (Jun 20, 2006 9:56:56 AM)
Let’s now discuss what technical indicators to use when the market is not moving up, nor down.

Wayne McDonell - FxBootcamp (Jun 20, 2006 9:57:08 AM)
Support and Resistance

Wayne McDonell - FxBootcamp (Jun 20, 2006 9:57:17 AM)
Price is in a range bound market because there is uncertain.

Wayne McDonell - FxBootcamp (Jun 20, 2006 9:57:24 AM)
The bulls and bears are in the market.

Wayne McDonell - FxBootcamp (Jun 20, 2006 9:57:33 AM)
However, neither is bold enough to take control.

Wayne McDonell - FxBootcamp (Jun 20, 2006 9:57:43 AM)
The bulls get prices moving upward, then they wimp out as the bears begin to sell.

Wayne McDonell - FxBootcamp (Jun 20, 2006 9:57:56 AM)
Then the bears enjoy the ride, but get nervous and jump ship just as price seemed ready to really fall.

Wayne McDonell - FxBootcamp (Jun 20, 2006 9:58:06 AM)
Trading this kind of market is like watching a tennis match!

Wayne McDonell - FxBootcamp (Jun 20, 2006 9:58:27 AM)
Why does this happen?

Wayne McDonell - FxBootcamp (Jun 20, 2006 9:58:51 AM)
The market simply lacks confidence to do one one thing or the either.

Wayne McDonell - FxBootcamp (Jun 20, 2006 9:59:17 AM)
This is usually due to a fundamental shift in the market.

Wayne McDonell - FxBootcamp (Jun 20, 2006 9:59:25 AM)
Such a central bank interest rate decision.

Wayne McDonell - FxBootcamp (Jun 20, 2006 9:59:38 AM)
So in a range bound market, play close attention to Support and Resistance levels.

Wayne McDonell - FxBootcamp (Jun 20, 2006 9:59:49 AM)
Clearly mark them on your charts with a bold horizontal line.

Wayne McDonell - FxBootcamp (Jun 20, 2006 9:59:58 AM)
Then watch for clues for reversal when price is near them.

Wayne McDonell - FxBootcamp (Jun 20, 2006 10:00:07 AM)
Now check out pivot points.

Wayne McDonell - FxBootcamp (Jun 20, 2006 10:00:14 AM)
Are there Pivot Points near the Support & Resistance lines?

Wayne McDonell - FxBootcamp (Jun 20, 2006 10:00:24 AM)
Pivot Points are just another form of Support & Resistance lines.

Wayne McDonell - FxBootcamp (Jun 20, 2006 10:00:32 AM)
Traditional S&R lines a plotted “visually”

Wayne McDonell - FxBootcamp (Jun 20, 2006 10:00:58 AM)
S&R are areas on the chart where price bounces.

Wayne McDonell - FxBootcamp (Jun 20, 2006 10:01:08 AM)
Traders use the subjective “eye ball” method.

Wayne McDonell - FxBootcamp (Jun 20, 2006 10:01:15 AM)
Pivot points are mathematical formulas that identify S&R from the previous days trading range.

Wayne McDonell - FxBootcamp (Jun 20, 2006 10:01:27 AM)
They only work because so many traders use them.

Wayne McDonell - FxBootcamp (Jun 20, 2006 10:01:47 AM)
But because they work, you should take them in account on a range day.

Wayne McDonell - FxBootcamp (Jun 20, 2006 10:01:54 AM)
Why?

Wayne McDonell - FxBootcamp (Jun 20, 2006 10:01:59 AM)
Because if price is reversing near a pivot point,

Wayne McDonell - FxBootcamp (Jun 20, 2006 10:02:05 AM)
and that pivot point is near your S&R line,

Wayne McDonell - FxBootcamp (Jun 20, 2006 10:02:13 AM)
you may have a good trade opportunity in a range market.

Wayne McDonell - FxBootcamp (Jun 20, 2006 10:02:30 AM)
Let’s throw something else into the mix: Bollinger Bands.

Wayne McDonell - FxBootcamp (Jun 20, 2006 10:02:40 AM)
BB’s measure volatility.

Wayne McDonell - FxBootcamp (Jun 20, 2006 10:02:51 AM)
They can be used in many ways to successfully trade FOREX.

Wayne McDonell - FxBootcamp (Jun 20, 2006 10:02:58 AM)
In a range bound market

Wayne McDonell - FxBootcamp (Jun 20, 2006 10:03:07 AM)
They are exceptionally important then they are horizontal.

Wayne McDonell - FxBootcamp (Jun 20, 2006 10:03:19 AM)
I often see this near a recent high/low with a retracement.

Wayne McDonell - FxBootcamp (Jun 20, 2006 10:03:40 AM)
Once the retracement is concluded and price moves back

Wayne McDonell - FxBootcamp (Jun 20, 2006 10:03:48 AM)
In the direction of the short-term trend

Wayne McDonell - FxBootcamp (Jun 20, 2006 10:03:55 AM)
But Bollinger Bands remain horizontal

Wayne McDonell - FxBootcamp (Jun 20, 2006 10:04:04 AM)
There is a high probability of a Double Top/Bottom

Wayne McDonell - FxBootcamp (Jun 20, 2006 10:04:11 AM)
Or a 1, 2, 3 Reversal Pattern.

Wayne McDonell - FxBootcamp (Jun 20, 2006 10:04:23 AM)
Again, this Bollinger Band behavior is especially important

Wayne McDonell - FxBootcamp (Jun 20, 2006 10:04:33 AM)
Near your S&R reversal areas you identified with bold horizontal lines.

Wayne McDonell - FxBootcamp (Jun 20, 2006 10:05:01 AM)
To see an example of virticle BBs, just check out the currect 15 min GBP chart.

Wayne McDonell - FxBootcamp (Jun 20, 2006 10:05:23 AM)
To see an example of horizontal BBs, just check out the current 15 min EUR chart.

Wayne McDonell - FxBootcamp (Jun 20, 2006 10:05:41 AM)
One last thing and then I’ll take some questions.

Wayne McDonell - FxBootcamp (Jun 20, 2006 10:05:48 AM)
Let’s talk about Candlestick patterns.

Wayne McDonell - FxBootcamp (Jun 20, 2006 10:05:54 AM)
I once took a $250 min-course from a guy who sells $2500 seminars on candlestick trading.

Wayne McDonell - FxBootcamp (Jun 20, 2006 10:06:02 AM)
This is the sum of all that I learned.

Wayne McDonell - FxBootcamp (Jun 20, 2006 10:06:12 AM)
If you get a reversal pattern at a Support & Resistance line, price is likely to reverse.

Wayne McDonell - FxBootcamp (Jun 20, 2006 10:06:21 AM)
No kidding! Duh!

Wayne McDonell - FxBootcamp (Jun 20, 2006 10:06:33 AM)
There really are only a handful of patterns that would help you identify a reversal.

Wayne McDonell - FxBootcamp (Jun 20, 2006 10:06:45 AM)
Double Tops/Bottoms Morning/Evening Stars 123 Patterns Bullish/Bearish Engulfing Candles. Shooting Stars/Hammers

Wayne McDonell - FxBootcamp (Jun 20, 2006 10:07:05 AM)
They are not fool proof.

Wayne McDonell - FxBootcamp (Jun 20, 2006 10:07:22 AM)
But they are much more reliable at major S&R lines.

Wayne McDonell - FxBootcamp (Jun 20, 2006 10:07:34 AM)
Remember the $2500 question: Is this pattern occurring at an S&R line? If not, ignore.

Wayne McDonell - FxBootcamp (Jun 20, 2006 10:07:41 AM)
Why make it more complicated than it really is?

Wayne McDonell - FxBootcamp (Jun 20, 2006 10:08:05 AM)
In summary, if you see a reversal pattern,

Wayne McDonell - FxBootcamp (Jun 20, 2006 10:08:11 AM)
that occurs at the top or bottom of your range,

Wayne McDonell - FxBootcamp (Jun 20, 2006 10:08:18 AM)
clearly identified by S&R horizontal lines,

Wayne McDonell - FxBootcamp (Jun 20, 2006 10:08:23 AM)
near pivots and held in by Bollinger Bands,

Wayne McDonell - FxBootcamp (Jun 20, 2006 10:08:31 AM)
price will likely reverse!

Wayne McDonell - FxBootcamp (Jun 20, 2006 10:08:38 AM)
The secret to trade range bound markets?

Wayne McDonell - FxBootcamp (Jun 20, 2006 10:08:46 AM)
Sell at the top and buy at the bottom.

Wayne McDonell - FxBootcamp (Jun 20, 2006 10:08:54 AM)
Use the indicators I shared with you today.

Wayne McDonell - FxBootcamp (Jun 20, 2006 10:09:00 AM)
To help identify where the top and bottom is.

Wayne McDonell - FxBootcamp (Jun 20, 2006 10:09:07 AM)
Wait for price to get to the extremes of this range.

Wayne McDonell - FxBootcamp (Jun 20, 2006 10:09:13 AM)
Then trade when price is rejected.

Wayne McDonell - FxBootcamp (Jun 20, 2006 10:09:19 AM)
You should have plenty of time.

Wayne McDonell - FxBootcamp (Jun 20, 2006 10:09:28 AM)
Wait for price to fall into your trap.

Wayne McDonell - FxBootcamp (Jun 20, 2006 10:09:33 AM)
Let price get rejected first.

Wayne McDonell - FxBootcamp (Jun 20, 2006 10:09:39 AM)
Get in late get out late.

Wayne McDonell - FxBootcamp (Jun 20, 2006 10:09:46 AM)
Don’t assume price will reverse just because of the range

Wayne McDonell - FxBootcamp (Jun 20, 2006 10:09:53 AM)
Just expect it to reverse.

Wayne McDonell - FxBootcamp (Jun 20, 2006 10:09:59 AM)
Wait for it to reverse.

Wayne McDonell - FxBootcamp (Jun 20, 2006 10:10:05 AM)
After it does reverse.

Wayne McDonell - FxBootcamp (Jun 20, 2006 10:10:12 AM)
Jump in and target the opposite extreme of the range.

Wayne McDonell - FxBootcamp (Jun 20, 2006 10:10:21 AM)
You think that is fun?

Wayne McDonell - FxBootcamp (Jun 20, 2006 10:10:29 AM)
Wait until the range BREAKS! Now that’s FUN!

Wayne McDonell - FxBootcamp (Jun 20, 2006 10:10:43 AM)
Thank you for your time.

Wayne McDonell - FxBootcamp (Jun 20, 2006 10:10:51 AM)
I will now take some questions.

Wayne McDonell - FxBootcamp (Jun 20, 2006 10:12:23 AM)
Question

Wayne McDonell - FxBootcamp (Jun 20, 2006 10:12:26 AM)
I would like to know.. when can u find that the range bound trading is going to start or is going to end. thanks, Kevin.

Wayne McDonell - FxBootcamp (Jun 20, 2006 10:13:05 AM)
Range is the "Anti-trend".

Wayne McDonell - FxBootcamp (Jun 20, 2006 10:13:34 AM)
If you do not see higher highs or lower lows, you could be in a range.

Wayne McDonell - FxBootcamp (Jun 20, 2006 10:14:03 AM)
This is especially true if you see a multi day Double Top and Double Bottom.

Wayne McDonell - FxBootcamp (Jun 20, 2006 10:14:13 AM)
Trade the range.

Wayne McDonell - FxBootcamp (Jun 20, 2006 10:14:28 AM)
When is it over?

Wayne McDonell - FxBootcamp (Jun 20, 2006 10:14:36 AM)
When S&R is broken.

Wayne McDonell - FxBootcamp (Jun 20, 2006 10:14:49 AM)
This is usually quite obvious.

Wayne McDonell - FxBootcamp (Jun 20, 2006 10:14:52 AM)
Why?

Wayne McDonell - FxBootcamp (Jun 20, 2006 10:15:16 AM)
The market often ranges when fundamental changes are happening.

Wayne McDonell - FxBootcamp (Jun 20, 2006 10:15:58 AM)
The range is broken when bias has returned to the market.

Wayne McDonell - FxBootcamp (Jun 20, 2006 10:16:38 AM)
I hope that helps.

Wayne McDonell - FxBootcamp (Jun 20, 2006 10:16:48 AM)
Oh, look at the euro...

Wayne McDonell - FxBootcamp (Jun 20, 2006 10:16:55 AM)
I've gotta move a stop...

Wayne McDonell - FxBootcamp (Jun 20, 2006 10:17:10 AM)
I'll also grab another question.

Wayne McDonell - FxBootcamp (Jun 20, 2006 10:17:26 AM)
which indecator is the best one mschcaa

Wayne McDonell - FxBootcamp (Jun 20, 2006 10:17:36 AM)
They are all good buddy.

Wayne McDonell - FxBootcamp (Jun 20, 2006 10:17:44 AM)
I don't favor one over the other.

Wayne McDonell - FxBootcamp (Jun 20, 2006 10:18:00 AM)
You could also throw in Stochastics or RSI

Wayne McDonell - FxBootcamp (Jun 20, 2006 10:18:15 AM)
Just pick a few and get really good using them.

Wayne McDonell - FxBootcamp (Jun 20, 2006 10:18:29 AM)
Just don't use 50 indicators.

Wayne McDonell - FxBootcamp (Jun 20, 2006 10:18:35 AM)
Nor should you use just one.

Wayne McDonell - FxBootcamp (Jun 20, 2006 10:19:33 AM)
New question

Wayne McDonell - FxBootcamp (Jun 20, 2006 10:19:36 AM)
Is there signs that your psychology is changing for the better when trading. Or do you all of sudden just become better c_luck_0001

Wayne McDonell - FxBootcamp (Jun 20, 2006 10:19:46 AM)
Wow, what a question!

Wayne McDonell - FxBootcamp (Jun 20, 2006 10:20:03 AM)
I traded on paper for two years.

Wayne McDonell - FxBootcamp (Jun 20, 2006 10:20:21 AM)
I found that I did well for some time, then poorlly for a bit.

Wayne McDonell - FxBootcamp (Jun 20, 2006 10:20:49 AM)
There was a time when I first started getting fairly good.

Wayne McDonell - FxBootcamp (Jun 20, 2006 10:21:06 AM)
That I did 20 trades in a row without a loss.

Wayne McDonell - FxBootcamp (Jun 20, 2006 10:21:16 AM)
My confidence was soaring.

Wayne McDonell - FxBootcamp (Jun 20, 2006 10:21:27 AM)
It even improved my golf game!

Wayne McDonell - FxBootcamp (Jun 20, 2006 10:21:40 AM)
I could do "no wrong".

Wayne McDonell - FxBootcamp (Jun 20, 2006 10:22:11 AM)
Until a small string of loss brought my perfect world crashing down!

Wayne McDonell - FxBootcamp (Jun 20, 2006 10:22:21 AM)
It didn't hurt my trading account much.

Wayne McDonell - FxBootcamp (Jun 20, 2006 10:22:27 AM)
but it hurt my ego.

Wayne McDonell - FxBootcamp (Jun 20, 2006 10:22:36 AM)
Which is often just as important eh?

Wayne McDonell - FxBootcamp (Jun 20, 2006 10:22:47 AM)
So to answer your question...

Wayne McDonell - FxBootcamp (Jun 20, 2006 10:22:56 AM)
It doesn't happen all at once.

Wayne McDonell - FxBootcamp (Jun 20, 2006 10:23:25 AM)
The students I coach suddenly have an a shocking wake up call.

Wayne McDonell - FxBootcamp (Jun 20, 2006 10:23:38 AM)
That people can actually make money in forex.

Wayne McDonell - FxBootcamp (Jun 20, 2006 10:24:01 AM)
To see it done day in and day out

Wayne McDonell - FxBootcamp (Jun 20, 2006 10:24:15 AM)
brings a higher level of empowerment and reality.

Wayne McDonell - FxBootcamp (Jun 20, 2006 10:24:30 AM)
But the hard work to fully understand everything doesn't go away.

Wayne McDonell - FxBootcamp (Jun 20, 2006 10:24:43 AM)
Its a skill that takes time and experience to refine.

Wayne McDonell - FxBootcamp (Jun 20, 2006 10:25:04 AM)
But the knowlege that a lot of people really make a lot of money trading forex

Wayne McDonell - FxBootcamp (Jun 20, 2006 10:25:14 AM)
is empowering in itself.

Wayne McDonell - FxBootcamp (Jun 20, 2006 10:25:19 AM)
just to see it happen.

Wayne McDonell - FxBootcamp (Jun 20, 2006 10:25:50 AM)
So it begings with the confidence that it really can happen.

Wayne McDonell - FxBootcamp (Jun 20, 2006 10:26:03 AM)
Then its a long road but a fun adventure from there.

Wayne McDonell - FxBootcamp (Jun 20, 2006 10:27:33 AM)
Boy, I hope the GBP breaks its 200 ema!

Wayne McDonell - FxBootcamp (Jun 20, 2006 10:27:52 AM)
MACD has crossed up.

Wayne McDonell - FxBootcamp (Jun 20, 2006 10:28:25 AM)
I may have to move my stop again... lock in more profits... yeee haaa.

Wayne McDonell - FxBootcamp (Jun 20, 2006 10:28:47 AM)
Here's another question

Wayne McDonell - FxBootcamp (Jun 20, 2006 10:28:50 AM)
please how do i confirm a retracement from S/R, can Double Tops/Bottom form in a low time frame,?

Wayne McDonell - FxBootcamp (Jun 20, 2006 10:29:26 AM)
By retracement, I think you mean reversal.

Wayne McDonell - FxBootcamp (Jun 20, 2006 10:29:39 AM)
Such as price being rejected by a top or bottom.

Wayne McDonell - FxBootcamp (Jun 20, 2006 10:29:52 AM)
How to confirm it?

Wayne McDonell - FxBootcamp (Jun 20, 2006 10:30:26 AM)
A candle with a small body and long wick like a shooting star on hammer.

Wayne McDonell - FxBootcamp (Jun 20, 2006 10:30:40 AM)
Or a candlestick formation.

Wayne McDonell - FxBootcamp (Jun 20, 2006 10:30:57 AM)
Two candles for an engulfing reversal pattern.

Wayne McDonell - FxBootcamp (Jun 20, 2006 10:31:13 AM)
Three candles for an evening/morning star.

Wayne McDonell - FxBootcamp (Jun 20, 2006 10:31:37 AM)
A short-term/longer-term moving average crossover

Wayne McDonell - FxBootcamp (Jun 20, 2006 10:32:03 AM)
Perhaps even stochastics returning below 80 or above 20.

Wayne McDonell - FxBootcamp (Jun 20, 2006 10:32:49 AM)
IF your risk tolerence is high, you could simply wait for a candle that "looks" like it was being rejected by the S&R line.

Wayne McDonell - FxBootcamp (Jun 20, 2006 10:33:02 AM)
This isn't crazy risky

Wayne McDonell - FxBootcamp (Jun 20, 2006 10:33:24 AM)
because your stop loss would just be a handful of pips on the other side of the S&R line.

Wayne McDonell - FxBootcamp (Jun 20, 2006 10:33:46 AM)
Next question

Wayne McDonell - FxBootcamp (Jun 20, 2006 10:34:06 AM)
Can Double Tops/Bottoms occure in short time frames.

Wayne McDonell - FxBootcamp (Jun 20, 2006 10:34:09 AM)
Sure.

Wayne McDonell - FxBootcamp (Jun 20, 2006 10:34:44 AM)
But I trust them on longer time frames more.

Wayne McDonell - FxBootcamp (Jun 20, 2006 10:34:59 AM)
15 mins are just fine.

Wayne McDonell - FxBootcamp (Jun 20, 2006 10:35:08 AM)
I trade on that chart every day.

Wayne McDonell - FxBootcamp (Jun 20, 2006 10:35:34 AM)
I check the daily and 1 hourly to key my eyes on the prize.

Wayne McDonell - FxBootcamp (Jun 20, 2006 10:35:41 AM)
But I trade the 15 min chart.

Wayne McDonell - FxBootcamp (Jun 20, 2006 10:35:57 AM)
If you are looking a two or three days of data with a 15 minute chart

Wayne McDonell - FxBootcamp (Jun 20, 2006 10:36:16 AM)
you'll see wonderful double tops/bottoms and awesome S&R areas.

Wayne McDonell - FxBootcamp (Jun 20, 2006 10:36:40 AM)
Next question

Wayne McDonell - FxBootcamp (Jun 20, 2006 10:36:42 AM)
You do not mention Fibonacci, do you like it?

Wayne McDonell - FxBootcamp (Jun 20, 2006 10:36:56 AM)
Love Fibonacci studies.

Wayne McDonell - FxBootcamp (Jun 20, 2006 10:37:06 AM)
I love them for retracements

Wayne McDonell - FxBootcamp (Jun 20, 2006 10:37:12 AM)
I love them for extensions.

Wayne McDonell - FxBootcamp (Jun 20, 2006 10:37:31 AM)
But this is exactly why I don't use them in range bound markets.

Wayne McDonell - FxBootcamp (Jun 20, 2006 10:37:55 AM)
They measure small retracements in the over all TREND!

Wayne McDonell - FxBootcamp (Jun 20, 2006 10:38:06 AM)
and predict the new HIGH.

Wayne McDonell - FxBootcamp (Jun 20, 2006 10:38:19 AM)
But we are talking about RANGE trading.

Wayne McDonell - FxBootcamp (Jun 20, 2006 10:38:31 AM)
There are no retracements or extensions.

Wayne McDonell - FxBootcamp (Jun 20, 2006 10:38:37 AM)
Just reversals.

Wayne McDonell - FxBootcamp (Jun 20, 2006 10:38:55 AM)
But I'm a big fan of Fibs.

Wayne McDonell - FxBootcamp (Jun 20, 2006 10:39:14 AM)
Couldn't imagine trading without them.

Wayne McDonell - FxBootcamp (Jun 20, 2006 10:39:31 AM)
But not in a range market.

Wayne McDonell - FxBootcamp (Jun 20, 2006 10:39:47 AM)
Just like I don't like Stochastics or RSI in a trending market.

Wayne McDonell - FxBootcamp (Jun 20, 2006 10:40:05 AM)
They tell you the when the market is over bought or over sold.

Wayne McDonell - FxBootcamp (Jun 20, 2006 10:40:09 AM)
But think about it.

Wayne McDonell - FxBootcamp (Jun 20, 2006 10:40:16 AM)
That is what a trend is!

Wayne McDonell - FxBootcamp (Jun 20, 2006 10:40:23 AM)
When everyone is doing the same thing!

Wayne McDonell - FxBootcamp (Jun 20, 2006 10:40:54 AM)
So that is a major point of my presentation today.

Wayne McDonell - FxBootcamp (Jun 20, 2006 10:41:01 AM)
Use the right tools for the job.

Wayne McDonell - FxBootcamp (Jun 20, 2006 10:41:30 AM)
An use a balance of indicators

Wayne McDonell - FxBootcamp (Jun 20, 2006 10:41:51 AM)
Along with historical and mathematically S&R lines.

Wayne McDonell - FxBootcamp (Jun 20, 2006 10:42:07 AM)
If you are unsure how to do this

Wayne McDonell - FxBootcamp (Jun 20, 2006 10:42:19 AM)
A book is unlikely to show you

Wayne McDonell - FxBootcamp (Jun 20, 2006 10:42:26 AM)
nor a DVD

Wayne McDonell - FxBootcamp (Jun 20, 2006 10:42:30 AM)
Get a coach.

Wayne McDonell - FxBootcamp (Jun 20, 2006 10:42:45 AM)
You need to SEE how all the indicators work together.

Wayne McDonell - FxBootcamp (Jun 20, 2006 10:42:55 AM)
In the real imperfect world.

Wayne McDonell - FxBootcamp (Jun 20, 2006 10:43:55 AM)
Next question

Wayne McDonell - FxBootcamp (Jun 20, 2006 10:43:58 AM)
how many highs and lows should there be in a sequece to be considered range market? How wide should the S&R band be in order to have a range market (making it worth the risk of entering the market) and not a tipically sideways?

Wayne McDonell - FxBootcamp (Jun 20, 2006 10:44:26 AM)
A double top and a double bottom is enough for me.

Wayne McDonell - FxBootcamp (Jun 20, 2006 10:44:41 AM)
Notice I say "AND"

Wayne McDonell - FxBootcamp (Jun 20, 2006 10:44:57 AM)
Price failed moving up and also failed moving down.

Wayne McDonell - FxBootcamp (Jun 20, 2006 10:45:12 AM)
I have the 15 min chart in mind.

Wayne McDonell - FxBootcamp (Jun 20, 2006 10:45:28 AM)
So this would likely be today's high and yesturday's high

Wayne McDonell - FxBootcamp (Jun 20, 2006 10:45:39 AM)
and today's low and yesturdays low.

Wayne McDonell - FxBootcamp (Jun 20, 2006 10:45:56 AM)
Until we break out, we'll bounce around here.

Wayne McDonell - FxBootcamp (Jun 20, 2006 10:46:11 AM)
I've you understand Pivot Point theory well

Wayne McDonell - FxBootcamp (Jun 20, 2006 10:46:31 AM)
It'll come if VERY handy in a situation like this.

Wayne McDonell - FxBootcamp (Jun 20, 2006 10:46:57 AM)
How wide should the support and resistance band be?

Wayne McDonell - FxBootcamp (Jun 20, 2006 10:47:09 AM)
You better be talking about Bollinger Bands!

Wayne McDonell - FxBootcamp (Jun 20, 2006 10:47:21 AM)
Don't mix this up with other bands!!!

Wayne McDonell - FxBootcamp (Jun 20, 2006 10:47:37 AM)
I use two standard diviations.

Wayne McDonell - FxBootcamp (Jun 20, 2006 10:48:38 AM)
Depending on the market, I use Bollinger bands to keep price below the BBs or above them.

Wayne McDonell - FxBootcamp (Jun 20, 2006 10:48:54 AM)
They are also great price targets for profit.

Wayne McDonell - FxBootcamp (Jun 20, 2006 10:50:53 AM)
Wow, was that an hour already?

FXstreet Moderator (Jun 20, 2006 10:51:57 AM)
Thank your for that Wayne.

Wayne McDonell - FxBootcamp (Jun 20, 2006 10:52:04 AM)
I'm up 15 pips on a range trade right now!

FXstreet Moderator (Jun 20, 2006 10:52:10 AM)
That’s all we have time for Today .

Wayne McDonell - FxBootcamp (Jun 20, 2006 10:52:11 AM)
How cool is that?

Wayne McDonell - FxBootcamp (Jun 20, 2006 10:52:49 AM)
I'm glad we had bollinger band examples in the live market during my presentation today!

Wayne McDonell - FxBootcamp (Jun 20, 2006 10:53:20 AM)
Thank you everyone again for your time.

Wayne McDonell - FxBootcamp (Jun 20, 2006 10:53:30 AM)
Feel free to contact me anytime.

Wayne McDonell - FxBootcamp (Jun 20, 2006 10:53:42 AM)
http://www.fxbootcamp.net

Wayne McDonell - FxBootcamp (Jun 20, 2006 10:53:58 AM)
or http://www.fxbootcamp.com/bcard.jpg. That is my business card with email and phone numbers.

FXstreet Moderator (Jun 20, 2006 10:54:38 AM)
Thank you all for your participation. See you all soon!