Well it’s been a while!! I have been busy doing consulting work in Paris – and today is the first day that I am back looking at the market. I have not done my discipline strategy for the past 7 trading days. Will resume with that tomorrow.
Just looked over daily and weekly chart of the 15 fx pairs that i follow. I see quite a few up S1 and S2 setups, however the ones that look best from a pure rating perspective are AUDCHF on the S1 type setup perspective, and Cable, AUDJPY and USDJPY on S2 type setup. All the other S1 and S2 setups do not involve strength and weakness, but rather a strength or weakness coupled with a mediocre currency – so this is less ideal than buying strength and selling weakness.
AUDCHF: To me, it looks like there’s another short entry on this one. there was a good pullback on 13th June, followed by two inside bars and then a very bearish hammer (?). Thus I am considering to go short @ 8790 with stop at 8915 – the previous low was at 8640, and then there is no previous support ahead of 8000 – I would adjust my stop to break-even if price got to 8640. Thus my stop would be 125 pips – I would go for a target of 8520 i.e. 270 pips, giving a reward to risk of a bit more than 2:1. I entered the order onto my FXCM platform (the first FXCM trade since late 2011!). Checked the position sizing.
GBPUSD: Nothing so far. There has not been a good pullback, but I will check the chart again tomorrow.
USDJPY and AUDJPY – of course, right from the start, all things being equal I would much prefer a trade in USDJPY if I am already going to short AUDCHF – to avoid being short AUD twice. In any case the chart looks better for USDJPY than for AUDJPY. There’s no sign of a pullback on AUDJPY, but there could be a pullback building on USDJPY. Am looking at the daily charts for pullbacks.
That’s all for today. I am hoping I will get through the market analysis more quickly tomorrow, and can then do some backward-looking on AUDCHF to see how many entries there had been on this pair in recent times.