FX trader Jennifer Thornburg discusses her combo trade that uses multiple time frames to trade.
My guest today is Jennifer Thornburg. We are talking to her about her evolution as a forex trader and what it took to become successful. So Jennifer, talk about what are some pitfalls that you kind of ran into and solved on your way to becoming a good forex trader?
Well, I think the biggest thing is what I like to call random trading. What I noticed that was happening with me is I would win a trade and I would be happy and I would lose a trade and I would kind of ignore it, and over time it just didn't really matter if I was winning or losing, it was all the same. And you lose, you give yourself a pass and without really a good idea of what I was trying to accomplish in the market. Even when I was successful, I didn't recognize it as success because I was already thinking bigger. For me it was all about really tying down what my plan is and what I'm trying to accomplish in the market. So if I'm taking a short-term trade and my goal was to get 10 pips then I know when I have done that as opposed to getting 10 pips and feeling bad because somebody else got 50 pips or something like that.
Is there a written trading plan that you kind of follow by rote, actual steps each day?
Well, you know these Expos are awesome. There are so many people here teaching trading strategies and as a long time student of forex, I'm always so excited when I read a new book or when I read a new strategy, and there is just so many different ways to chop up the market. The more you learn and the longer you have been doing it, it is almost impossible to turn some of that off. I don't have, necessarily, a rule book, but when I stick to a single trading strategy I try not to mix in all the other stuff that I have learned, so that I stay focused on what it is that I'm trying to do. I don't just stick to one strategy, but I stick to one strategy at a time.
All right, what is it right now? What is a strategy that you are using right now that seems to be working for you?
My favorite strategy right now is what I call the combo trade and it is a trading strategy that I developed from mixing my experience from lots of different techniques that I have sort of built into a single strategy, and I trade it from the four-hour and the one-day charts, so the four-hour and the daily charts, and I am very certain about what it is that I'm trying to accomplish so that when I get there I know it, I don't miss it and I'm not looking for something more, and when I'm unsuccessful, I know how to process that information as well so that I can reduce the bad experiences and make more of the good ones.
Combo trade, that must mean something specifically; what does combo mean?
Sorry, yeah, it does, it is just a combination of indicators that I put together into a trading strategy, so from the four-hour charts it is really very simple, I like to use moving averages and I identify tradable spaces as price works its way to and from and in between simple moving averages on the chart and I like really clean, wide open trading spaces and I just like to be very calm about getting in there and taking a piece of action out of there and closing out and not being too crazy with too many indicators.
I know some people are going to ask if I don't ask the question, so what moving averages do you like to use?
Oh, sure, my favorites are the 50 and the 100 simple moving average and they work together really well and they create space in between them and price runs away from them and runs back to them over and over again every day, so it gives me nice identifiable spaces on a chart that I can look to set up trades in.
All right and then finally, what do you feel like you still have to improve on as a trader, what do you still want to achieve?
Well you know, my motto in trading is that I like to remain calm, I like to be calm; calm trading is successful trading for me and just like everybody else I'm pretty excitable. What I would like to be the best at is just to be very calm when I'm winning, very calm when I'm losing, so that I can stick to the plan and have repeatable results every day-every week.