Archives for February 2013

EURGBP trade to begin our trading week.  I teach my students to keep an eye on this pair when the EUR is moving one direction and the GBP the other direction.  Two advantages to trading this pair include; it tends to move at a slower and steadier pace than the either the EUR or GBP and it is crossed with the GBP, so currently each pip is worth 1.54 times what a USD crossed pair is worth.

The EUR began to move up during the UK session with the GBP moving downward.  After a wicky candle bottom the EURGBP began to rise and close back above its Asian session low.  It tested and re-tested the Asian session high before rising through our Targets 1 and 2.  With a small stop and a greater that 3:1 Reward to Risk ratio, this trade started our week very positively.  As the UK session ended, it was still looking like it had a bit of momentum to the upside, so we held on a few minutes longer than usual to close it out.  This was an excellent way to begin the week.

There was also a very nice setup on the GBP (not shown) so all in all, a very profitable session.

Let’s see what the rest of the week brings us.

Good luck with your trading!

The AUD trades continue this week.  We haven’t had any stellar trades with the AUD this week, but they add up.  We waited until after the UK economic release to enter short.  With a small stop just above yesterday’s high, our minimum 3:1 Reward to Risk ratio to our Target 2 criterion was met.

The AUD had been unable to close above yesterday’s high once the UK traders began their session.  Price moved down to test and re-test the Asian session low, before dropping further.  As price penetrated our Target 1 and began to pull back we exited the trade for acceptable gains.  Once we reach Target 1, we are very protective of our profits.  After the US economic release, price dropped through our Target 2, but we are very comfortable with our execution.  Successful and consistent trading has more to do with discipline than attempting to get the maximum number of pips each trade.

Enjoy your weekend!

Back Tuesday.

AUD began climbing higher shortly after the UK session got underway, but could not close above yesterday’s high.  We observe price for a while and with no significant news releases pending, we enter short.   We look to see what will happen near the Asian session low.  Price continues downward and we protect our profits by placing a “take profit” just above the Asian session low ( not shown on the chart ) but highly recommended.  As a wicky bottom candle forms below the Asian session low, we wonder if buyers are entering the market.

We are now prepared to close the trade if price retraces, so as to protect more profits.  I personally like to place my “take profit” above/below structure, or lock in pips usually but not always in 10 pip increments.  Price continues down one more candle and we close on the following candle as price begins to retrace.  It would be nice to have had a larger move downward, but we can only get what the market offers on any given day.  It is much more important to be able to read price and manage your trades, than to concern yourself with big moves each day.  Some weeks the market is much more generous than other weeks.

Happy Valentine’s Day!

Good luck with your trading!

The AUD set up nicely fairly early in the trading session, allowing for a short with a very small stop loss. Fortunately is was not volatile after the UK news which certainly affected the GBP, EUR, CHF and EURGBP pairs.

I like this setup and really love it when the Asian session has had a extended range.  With a very tight stop, I was hoping that price would move down to at least the Asian session low, as it was making no signs of moving up to test the Asian session high.  Alas the trade fizzled out at yesterday’s high and that was it.

Modest gains are always better than modest losses.  After the UK news some trade setups were very evident, but I don’t like large stop losses, so I walk away from those types of setups.  There is nothing easy about forex trading and some days are humbling.  Let’s see what tomorrow brings.

Good luck with your trading!

Although there was lots of movement during the UK session, it was difficult to find a setup that met our minimum 3:1 Reward to Risk ratio.  The NZD or Kiwi moves very similarly to the AUD most sessions.  The Kiwi setup required a smaller stop loss and the setup was more convincing to my eyes.

Both the NZD and AUD as it turned out, began to move at the same time.  If a trade gets away from you in one pair, have a look at a similar moving pair for an entry, but never chase a trade.  The EUR and CHF move inversely, so I usually like to confirm a setup in the EUR with the CHF looking like it will move in the opposite direction.

Good luck with your trading!

Back tomorrow.

The EUR was much more contained in its movement overnight.  After an exceptionally large drop Thursday, it is not surprising to see it attempt to stabilize today near yesterday’s low…at least for now.

The setup was very similar to Thursday, but the move down ended at yesterday’s low and temporarily reversed.

On a side note, my platform has been showing some corrupted data.  The gap down in yesterday’s chart turned out to be erroneous caused by a data corruption issue.  It is not unusual to see a gap in the forex market between Friday’s close and the new week’s opening, but it is very rare to see gaps during the week.  I’ve had a couple of issues in the past 2 weeks with data, so I will download a new charting platform this weekend and continue to compare it to other MT 4 platforms.

Technology is wonderful but far from perfect.  Always have your broker’s trading desk’s number on hand, just in case you encounter a power outage or become aware that your charting data may be off.  I know from experience, not being able to see your charts while in a trade, due to a computer malfunction or power outage can be quite stressful.  It’s nice to be able to call the trading desk to ensure your trade is moving in the desired direction or be able shut it down.

It’s been a great trading week and we look forward to next week.

Enjoy your weekend!

Back Tuesday.