I was listening to the radio yesterday and I saw the band name pop up: Dropkick Murphys.  And that made me think of Dave Murphy, who has drop-kicked his fair share of awesome trades in his time, which is to say that he has done some great things — ask me sometime about his trading of the GBP/USD during Thanksgiving 2006.  Anyway, I wanted to name a sell trade in a descending channel the Dropkick Murphy trade. 

This is simply a trade that sells when a currency pair touches the top of a descending channel.  It’s even better if this candle is a reversal candle (this requires waiting for the candle to form).  The profit target is the bottom of the channel, but it’s a good idea to move the stop to break even when the pair hits the first fibble.  The stop loss goes 10-20 pips above the top of the channel.

Also, remember that we can trade a close above the top of the channel, but we’re not talking about that right now (much more of that kind of stuff below in the other entries).

Here’s the chart:

My Friday trade plan is below.  You can share your own Note Card Trade Plan in the FXStreet.com forum.  Click here to visit the thread.

Well, the earthquake trade worked out nicely.

I’ve been posting in the forum (click here to see the forum) about daily trade plans.  I think it’s a good idea to have some sort of daily trade plan that you look at, that you can post next to your computer.  It works for me, at least!

Here’s an earthquake trade.  This trade was initial mislabled as a 4hr chart.  It’s a 1hr chart.  It’s a sell trade below the bottom of a support level in a descending channel.  I just made up the name.  If you don’t like it, please write to Wayne McDonnell and tell him.  Wayne had nothing to do with this, but he’s a friend of mine and I thought he would appreciate getting some of my email.

Anyway, if the pair breaks below the support level, that’s a sell trade with a stop above the support level (50 pips above or so) and a target of the bottom of the channel.  The buy trade comes above the top of the channel, on a close above the top, and the target will be Winnipeg lines.  We’ll draw those if it happens.

Happy earthquaking.

Welcome to Winnipeg!

In the pink shaded area, you can see the entry for a Winnipeg short trade on this pair.  The trade could now be closed (that’s my choice, anyway) because it has hit the last Winnipeg line outside my channel.

I’d be happy to sell this pair on a close below the bottom of the channel.

The USD/JPY formed a new channel and broke out of it — I missed the entry but I would be happy to sell the pair if it rises back up and re-touches the bottom of the channel.  That would be a Winnipeg trade.