Forex Tips

The Asian session was very active.  When the UK session got underway, it left little room for traders to make money trending the pairs any further to the downside.

Once you realize that a pair statistically will move only so far in a given 24 period typically… then you keep your eyes open for a reversal when a new session of traders begin their trading day.  It’s a very rare exception, when the majors will put in twice their expected range.  It does happen, but it is usually a result of a very unexpected comment by the US Fed or ECB etc, a geopolitical event, or something really unforeseen that changes the sentiment of the financial landscape.

The GBP had moved down to our Target 1 by the time the UK trading started.  A familiar and textbook trap is set luring in breakout shorts – followed by 2 higher lows.  An entry long is taken with a stop loss just below the Asian lows.  We keep this tight as US PPI is due in 30 minutes.  Price moves up and we are hoping for a reversal completion to the Asian high.  Price moves up making a series of higher lows but loses momentum at yesterday’s low.  Suddenly in the last 15 minutes of the session the GBP begins to spurt up… pushing through our targets 1 & 2, yesterday’s high and keeps going with momentum to the 1.6300 figure.  This is an exceptional move and the other majors showing USD weakness across the board.  At the first hint of weakness above the figure we clicked out and that was a beautiful move!!!

When you get one of these sudden moves, you need to know where your targets are…because vertical moves are not sustainable.  The market stops at and reverses for a reason – it is not capricious.  Learn what to look for and you will be rewarded.  If you are just guessing, you can lose your money quickly,

Good luck with your trading!

Back tomorrow if we find a trade.

Questions Michael@privateforexcoaching.com

The EUR set up for a quick short today.  The move did not last long and and an aggressive trader could have taken a long shortly afterward, but it’s safer to trade with the trend.

A number of pairs set up at exactly the same time today, but the EUR has the best spread and is the most traded pair.  The same setup was there on the GBP, CHF (inversely) and AUD too. If you took any of the 4,  hopefully you did well.

The EUR moved quickly down and closed just under the Asian session low.  This is typically the first challenge and we expect the next candle to retest this level.  In our case, we will allow a few pips of wiggle room just above the Asian low and hope that it will then move on down to our Targets 1 and 2.  The next candle price moved up as buyers prevented the 1.2900 handle from being tested.  We exit the trade not prepared to give back any more pips.

Enjoy your weekend!

We will be back Tuesday if we find a trade.

Michael  privateforexcoaching.com

A quieter session overall with little news during the UK session to affect order flows.

Both the CHF and JPY set up for countertrend shorts.

If you are comfortable trading against the trend, ensure that your RR ratio is met, we like a 3:1 RR in advance of the US open and 2:1 afterward up to the UK close.  Make sure to keep your stops tight and take a smaller position because it is a lower probability trade.  If it fits in your trading plan execute accordingly and if it doesn’t…walk away and come back tomorrow.

Looking forward to ECB President Draghi’s comments and market reaction for tomorrow’s session.

Good luck with your trading.  Be disciplined and focused!

Back Friday if we find a trade.

Questions ???  Michael@privateforexcoaching.com

The EUR set up beautifully for a short after it failed to close above yesterday’s high – reversing twice, and making a second lower high for the session.  We enter short with a text book reversal set up and a greater than 4:1 RR to our Target 2.

Our first challenge is to get through the Asian session lows – which price does as the US traders push it lower.  After a good size move down, we can expect a retracement and as a lower wick appears, we tighten our take profit.  Price pushes lower and then begins to move up to its open…and we exit the trade.

Always be cautious when you see wicky candles as they are indicative of a move slowing down and reversals.  Use them to your advantage.

Money flows have picked up considerably for September.  The EUR continues to be a favourite to short at the moment.  USD strength is the current theme.

Good luck with your trading!

Back tomorrow if we find a trade.

Questions please email Michael@privateforexcoaching.com

The NZD has been trending downward since July and has been an easier pair to trade than the ranging AUD.  The chart is clearer and the trend is down.  Both pairs typically move in the same direction crossed against the USD on a session basis.

The NZD has the potential to fall considerably further as the USD bullish trend continues. Tomorrow’s RBNZ Monetary Policy Statement will be closely observed by traders.

In the late US session yesterday, we can see the US traders selling the pair after a brief retracement higher. The Asian traders did not reverse the London or New York move and the pair moved down another 30 pips before making another lower high as the UK traders began their session.  The pair was unable to close above its Asian highs as the US session got underway.  A short is taken with a stop just above the session spike high.with a greater than 4:1 Reward for Risk to our Target 2.

As price moves lower we protect our gains by moving our profit stop down, and when price bounced off our Target 1 we close the trade to protect our profits.

The EUR which has been our favourite short lately ran into some profit taking today.  It continues to have significant downside potential in the short term and we will be looking to re-enter short.

The USD continues to strengthen, so our preference is to trade accordingly – with the Trend.

The GBP is suffering as the polls continue to predict a growing Scotland Independence outcome,with the next poll being on Friday.

Good luck with your trading!

Back tomorrow if we find a trade..

Questions please email Michael@privateforexcoaching.com

The major focus this week for the EUR will be the ECB Press Conference tomorrow and the Non-Farm Employment number on Friday – so be very careful trading in the meantime.

Our bias remains short and when the setup is there, we will gladly take it and ride it out with tight stops as was the case today.

As price showed sellers above and with no major US economic news, a short is taken after price once again could not stay above 1.3155.  With an 8 pips stop loss this was a greater than 4:1 Reward for the Risk to our Target 2.  Price had difficulty penetrating the Asian highs and retested this level before moving down to test yesterday’s high… as the session ended, we close the position near this level.

The EURGBP is a cross that will allow traders to take advantage of the current EUR weakness and GBP strength.  The GBP currently is susceptible to some market weakness due to the Scotland referendum vote but it’s worth keeping an eye on this pair now that it has become more active.

The institutional core EUR shorts may be adding to their positions on retracements near the 1.3200 – 1.3220 area.  This area is not where I would want to be long the EUR with a deep stop.  If you look at the August 22 low and the August 28 high – you will see why this is an important level.  Hint – trade with the BIG institutions not against them.  The 1.3100 level and 1.3000 level to the downside will be important for the EUR in the short term.

We do not trade on Non-Farm Employment Fridays.  If we don’t find a trade tomorrow, we will be back next Tuesday.

Good luck with your trading!

Any questions email   Michael@privateforexcoaching.com