Strength/Weakness Strategy – Jun19

Reviewed 15 pairs.  Nearly all pairs are showing either S1 or S2 setup.

Question: We want to buy strength and sell weakness. However strength and weakness may differ between the weekly and daily matrices. Is it a good rule of thumb to look at the W matrix for S1 setups, and at the D matrix for S2 setups?

If I use that approach then I discard a lot of the setups from today's list and focus on EURGBP, EURAUD and AUDCHF for S1; and GBPJPY, AUDJPY and USDJPY for S2.  I am doing that because for each of those pairs there is a distinct gap in their rank on the strength/weakness list of the relevant timeframes (either D or W).

I will now look through these six pairs (rather than the initial 13) to see whether I have setup or not.  The 1st pair to look at is AUDCHF since I still have an order in the market for that one.

....  Well I ended up looking at those charts for quite some time.  I think it was good for learning.  My process comprised looking for reversals on the D charts, and then looking for some good price action setups.  Whether or not there was a pattern was not always very clear - but I tried to make a judgement call on those combining everything I was seeing.

In the end I shorted GBPJPY (@148.30, stop 149.34, target 146.30) at market  on the basis that it was very likely to turn into a Corn Trade on the 4H timeframe (and it did).  I ended up selling close just a few pips above the low of the Corn-Trade candle.

I also entered sell-orders in for AUDJPY (sell 8965, stop 9085, target 8550) (pin bar and a whole lot of inside bars on D chart) and USDJPY (sell 9475, stop 9555, target 9240) (potential corn-trade on 4H, inside bar and potentially a 3-bar breakout on D chart).

Since all three of these trades involve the Yen, I allocated 0.5R to each trade.

I am leaving my AUDCHF short order in the market.  I am finding it difficult to assess this one - it just feels as if I missed the entry on that one on Tuesday (I missed it by only a couple of hours). Do I really want to go short @ 8780 if price rallies back to that level.

I also liked EURAUD and think there's some PA there too.  However my brain is starting to stop working so I am going to leave this setup for tomorrow and see how today's D candle closes.

What worked well today? Spend a solid 3-4 hours on the markets.  Reviewed training documents that we worked through a couple of weeks ago.  Tried to apply what I learned to the charts in front of me.  Tried to get into the habit of following a series of steps.  Am making some questions for my trading coach for the next coaching session.

FOMC Meeting is later today.  I guess it might be good to open new positions today - but if that is the case, then how often should I refrain from making trades (i.e. for how many announcements should I make an exception?) and for how many days prior to major announcements should I not trade?

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