Michael Bridgman

With scandals and politics in both the U.S. and Japan today, the USD came under pressure and we took advantage of a short setup late session.  After a very strong day for the USDJPY during the Asian and first half of the U.K. session, it began to unravel as the U.S. session got underway.  After a brief move up, the pair reversed downward and we risked 12 pips for a potential 72 pips to our downside target (106.25).  With a lower high in place, we went short and rode price lower…closing the trade at the London close.

The idea was to go short using a small stop loss due to the limited time left in the session and also to get the risk out of the trade as soon as possible…locking in profit as the trade progressed downward.

 

On a fundamental basis, the USD looks poised to strengthen with interest rate hikes beginning next week and a potentially more conciliatory North Korea.   Also, with some of the changes in the White House, will oil begin to move up?

We have a very active markets at the moment.  I’m beginning to hear more and more traders talking about how profitable February and March have been for them.

On Wednesday, ECB President Draghi will be speaking followed by a number of U.S. economic news releases.

Good luck with your trading!

 

I’m behind on my postings due to some site update issues which sent my emails from Friday afternoon until Tuesday morning into lost cyber space.  If you tried to reach me over this period, please email me again as the issue has been corrected.

The markets have been very volatile as “trade war” talk and tweets have created uncertainty for the capital markets.  Who will be affected by steel and aluminum tariffs imposed by the U.S is still not clear… nor are the retaliatory measures that affected countries might impose against the U.S.  We do know that Mr. Cohn has parted company with the president over the issue and the markets reacted swiftly.

On Wednesday as the EURUSD failed to close above its Asian high, a short setup was found with a very attractive return if price had made it down to our daily target.  When price bounced back above its Asian low, our profit stop was triggered and the trade yielded a modest gain.

Today, we chose to trade the GBPUSD early in the U.S. session and avoid the potential volatility while ECB President Mario Draghi was speaking.  The USD was strong today after a volatile week and we risked 23 pips for a potential 47 pips to our daily target at 1.3824.  Price moved down quickly and we closed the trade as our target.

The markets remain in a heightened sensitivity mode so it is prudent to keep your stop losses tight and cherry pick your entry setups…while protecting your profits.

I will back next week and pass on trading tomorrow with the NFP numbers due.

Good luck with your trading!

 

Avoiding potential volatility today during Fed Chairman Powell’s  testimony, we chose to concentrate on the EURGBP as confusion regarding Britain’s Brexit weighed on the GBP.

An entry long was taken risking 15 pips for a potential 44 pips to our daily target.  Price was reversing upward and sustained its momentum moving through its Asian low and through its Asian high.  As price tested and retested an important level from the daily chart, we exited just in advance of the U.K. close.

 

The USD lost its upward momentum today unrelated to Chair Powell’s comments.  It was President Trump’s tariff talk  which created a lot of uncertainty for the markets resulting in both USD weakness, and the stock indices plunging.

The GBP could be quite volatile tomorrow with Prime Minister May speaking and subsequently Governor Carney.

The Euro too will be interesting as traders will be very interested in the SPD vote in Germany this weekend as well as the Italian election outcome.

Good luck with your trading!

Traders will be waiting to see if the Fed’s gauge of economic growth implies the market’s expectation of 3 rate hikes for 2018 or possibly  a fourth?

The USD has been stronger this week and after a double-bottom and a bullish engulfing candle in the USDJPY, and entry long was taken risking 13 pips for a potential 72 pips to our daily target at 108.16 (not shown).  Price moved up, but fell short of testing its Asian high before the London close.  As price started to come back down in advance of the London close and FOMC meeting minutes, our trade is closed by our profit stop.

There is not a lot of major economic news releases this week, but the USD strength has continued thus far.  As traders we can only take it one day at a time.

Good luck with your trading!