Michael Bridgman

I suspect it was institutional transactional traders buying in the early UK session that brought the EUR back up to the Asian high – where the sellers began to enter.  After 3 lower highs, we enter short with a stop of 13 pips for a potential 119 pips.  When you find a R/R of 9:1 in a pair that is so clearly trending…it’s hard to resist.  A bit of patience earlier in the week has paid off the past couple of sessions.

Price began to descend and paused at the Asian session lows.  With news pending, we move our stop loss to plus 1 pip.  The pair descends further and tags our Target 1 at 1.0505.  We exit thinking that getting through the 1.0500 figure, yesterday’s low and making it to Target 2 may be ambitious for a Friday.  Price retraces then plunges to our Target 2 without us.

This pair is heading for parity and below in my opinion.  Be cautious around the figures but we are taking out swing lows from over 11 years ago and continuing downward.  Do not be fooled by brief retracements.  The trend is USD strength and it’s easier to trade with the trend!  Next week we have FOMC on Wednesday to look forward to.

Good luck with your trading and enjoy your weekend.

Back Tuesday if we find a trade.

 

The GBP has now retraced from its Jan. 23 low of 1.4950 to its high on Feb. 26 of 1.5551 back and below 1.4950.  As mentioned last week the 1.5000 level was imminent.  USD strength remains the trend and trading accordingly is the safer trade.  Although I can make a case for a continued lower GBP – it is prudent to be respectful of ranges.  At the lower end of a range…buyers will emerge and at the upper end of a range… sellers will emerge. Anticipate some two-way price action.

After the US economic news releases today, an entry short is taken with a tight stop above the previous candle as BofE Governor Carney was speaking.  There clearly were no buyers above the 1.5000 big figure and price started to move down – with trend.  As lower wicks began to appear, we moved our take profit level down to just above the previous candle high.  The market took us out  and continued its move to and beyond our Targets 1 and 2.  Although we missed more than half the move, it is better to heed price than to be greedy.

There appears to be plenty of room still for this pair to fall further but price is likely to be a bit sticky around the 1.4800 figure before dropping further.  Selling retracements and looking for short setups is what I will be looking for.  A retest of 1.4950 to 1.5000 area would not be unusual.

Good luck with your trading.  Keep your stops tight and your risk exposure small as money management is imperative to trading success!

Back tomorrow if we find a trade.

 

The GBP made 2015 highs last week in the 1.5550 area.  Last Thursday sellers emerged and we saw strong profit taking and a very bearish reversal.

Today we saw a familiar setup of lower highs continuing and a nice reversal in advance of the US Open.  A short is taken with a tight 15 pip stop loss and the event risk being the ADP Non-Farm Employment Change.  A quick move up on the release came shy of moving above yesterday’s low and the downtrend continued.  We tighten our stop loss to plus one pip and subsequently lower as price moved toward our targets.  As price is more likely to retrace after Target 2… we tighten our take profit  and the market takes us out.

Price continued lower without us but bounced at a very important level on the 4 hour chart.  If this level gives way, price has room to move and test the 1.5000 Big Figure.  The remainder of the week has a lot of event risk culminating with Non-Farm Employment Change on Friday.  Be very careful trading and keep your stops tight.

Good luck with your trading!

Back tomorrow if we find a trade.

There has been talk among institutional traders that the volumes are way down since Yellen’s speech.  Expectations have been dampened and traders await the Non-Farm Payroll number next week.

Well we certainly had a move today.  If you caught either the EUR or the GBP short, you had a very rewarding day.

The idea with the GBP was to wait for a clear break below the Asian range. The R/R to our Target 2 exceeded 3:1 with a stop loss just above the Asian lows.  As price dropped we keep tightening our take profit.  Price breaks through our Target 2 and yesterday’s low.  We anticipate at this stage that it will reverse and we keep our take profit tight.  As price moves back up we are taken out of an exceptional move.

If you caught the EUR you did even better but the R/R wasn’t as attractive from my perspective.

 

Good luck with your trading!

Back tomorrow if we find a trade.

In advance of the BOE Carney’s announcement about the One Bank Research Agenda the GBP set up with a classic short reversal.  The idea was to keep the stops tight and see where the market would eventually take us out.  Price moved down before bouncing back above yesterday’s high… where we were taken out.

After Janet Yellen’s testimony yesterday the market has been fairly quiet and we remain USD bullish… but with a less enthusiasm.  A possible rate hike for June is still possible, but could easily be delayed.  The Fed is not going to put the economic recovery at risk.

Good luck with your trading!

Back tomorrow if we find a trade.

After initially selling off early in the UK session, the CHF found buyers at .9385.  After a very bullish candle an entry long is taken with a stop below the Asian session lows.  We anticipate a retest of the Asian session lows – particularly after a large move up from the daily low.  The move gained momentum before stopping and retesting our Target 1.  As price dipped we exited the trade choosing not to give back any pips after Target 1 was attained.

Good luck with your trading!

Back tomorrow if we find a trade.