Michael Bridgman

After a long Easter weekend the markets were very active today and the USD was on its back foot.  As the session progressed the EUR broke higher and began a move toward 1.0700.  After a familiar “W Pattern” formed, a long EUR position was taken with a stop loss below the previous 2 candles’ double bottom.  With a daily target just under 107.00 we rode the trade higher through yesterday’s high and closed it early in the U.S. session as a candle closed at our target.

The EUR will remain sensitive to the French election first round outcome this Sunday and with Britain now having an election on June 8th, the EURGBP will continue to be a worthwhile pair to keep an eye on.  The announcement by P.M. May today has been positive for the GBP.

Trade cautiously as we continue through the geopolitical volatile period.

Good luck with your trading!

After a third higher low for the day and a stronger USD, a long trade is taken risking 10 pips.  Price completed a reversal formation and closed above yesterday’s low.  When price bounced off its low today in the Asian session, buyers were entering at a very important level on the Daily chart.  The USDJPY has been coming down all week and it was not surprising to see it move up today with a stronger USD.  If today’s low is retested and gives way, it will be very telling.  If it price continues higher… a break and daily close above 110.00 will be telling.

When taking countertrend trades, it is prudent to use tight stops and not to expect as many pips.  Lock in profits along the way and get the risk out of the trade as soon as possible by moving your stop loss to a positive net position.  Also it’s a good idea to take smaller size positions.  As always read price which is the best indicator of all and protect your profits.

Enjoy the long weekend and good luck with your trading!

On Tuesday a USDJPY short setup occurred after the pair began to rollover after testing the mid level of its Asian range.  Risking 13 pips for a potential 58 pips to our daily target. we entered.   Once the U.S. session got underway, the pair moved down rapidly.  As it approached our target of 110.03, it moved right through it and plummeted to 109.62 before retracing slightly.  We chose to exit at the close of the next candle.

On Wednesday the USD remained soft and another attempt to go short the USDJPY only yielded 10 pips before we exited before the U.K. close.  The U.S. session has been quite active lately after the U.K. close and numerous reversal are occurring.

With tensions mounting geopolitically it is prudent to trade with tight stop losses and lock in your profits.  Gains can be erased in a blink and stop losses hit if the situation with North Korea escalates.

Good luck with your trading.

Mario Draghi said little to encourage any Euro buying on Thursday.  Waiting until the U.S. session began, we conservatively waited for a short setup.  With a small stop loss above the U.S. session high, we entered short hoping to get down near the .8500 level.  Price moved down to test its Asian session low before finding buyers under yesterday’s low.  When a long lower wick appears, experience tells me to tighten up my profit stop as buyers are entering…and to watch the next candle closely.  As the U.K. session was ending soon, we exited the trade as price began to move up.

Tip:  On Tuesday during the U.S. session, I entered short the USDJPY after a second lower high and a very bearish candle.  The trade moved immediately in my favour.  I then got busy with something else and took my eye off the trade.  I glanced back a few minutes later and the pair was moving nicely down.  Instead of protecting myself and moving my stop loss to a profitable plus one, I focused my attention elsewhere, thinking that I would check back in a bit to check on the trade.  When I did, my trade was closed and the stop loss had been hit on a reversal.

There are risks associated with trading and we accept those risks whenever we enter a trade.  When a trade becomes profitable, if you can’t keep your eyes on it, remove the risk from your trade by moving your stop loss to a positive net position.  Even if this is just plus one pip, it makes more sense than being stopped out and puts you in a “stress free” position while the trade is on.   I really kicked myself for being distracted and not having moved my stop loss down in this case.  The stop loss was only for 13 pips, but if I can’t watch my trade to interpret what price is telling me, then I need to remove the risk from it… or not trade.  Be very careful of distractions when you’re trading as they can be be expensive lessons.

Enjoy your weekend and good luck with your trading!

This trade is very similar to yesterday’s trade.  Having missed out on the wave down during the U.S. overlap yesterday, I jumped back in today and it worked out well.

After a reversal setup above its Asian highs, a short entry was taken risking 17 pips for a potential 62 pips to our daily Target.  The pair moved down and paused at yesterday’s low just as the U.S. session got underway.  Our profit stop closed the trade but today we waited for another reversal setup and entered short a second time.  The pair moved down and we exited at the end of the U.K. session.

The U.S. session has been very active the past month and I’m inclined to change my trading hours if this continues.  The Asian session too has been more active than last year.  Had I not need to be somewhere today, I would have left this trade open a little longer.

Keep an eye on the EURGBP for the time being as it will be active.  Japanese year end repatriation flows end today.  The JPY pairs will be interesting next week with my favourite one being the USDJPY.

Good luck with your trading and enjoy your weekend.

The EURGBP is a fairly easy pair to trade.  I particularly like it when the EURUSD and the GBPUSD are moving in opposite directions.  This is often due to an economic news release.

With the Article 50 triggered and delivered, it will be interesting to see if the GBP strengthens or weakens going forward.  The activity in the EURGBP certainly picked up today and we caught some of the move but the U.S. Open took us out of the trade at our tight profit stop.  The U.S. session produced another good size move to the downside that we missed out on.

As London opened the pair stalled at its Asian highs and began to reverse.  A short was taken risking 16 pips for a potential 53 pips to our Target. Price moved sideways for the first hour of the trade, then dropped through and retested its Asian session lows before dropping further then consolidating going into the U.S. Open.

This pair should be very worthwhile watching going forward.  Remember that the cross is sterling and hence worth approximately 25% more per pip than a USD cross.  Trade with stops and position sizing accordingly.

Good luck with your trading!