Strength/Weakness Jun20

Reflection I am already starting to keep on looking at the levels of my two open positions.  I had a problem with that towards the end of 2011, when I last stopped trading full-time.  I know this negatively impacts on my productivity.  I have opened the positions and I am satisfied with the reasoning I had for entering the trades.  For now, it’s not necessary to adjust the stops – thus it is not necessary for me to continuously check the price.

STAM Review

Last night was the FOMC Meeting – basically the Fed said that they think that the economy is starting to recover – thus the Fed will start to taper their asset purchases, which thus far had supported economy a lot and strengthened the stockmarkets. As a result of this the USD rallied.  I expect to see quite a change in the pairs that I monitor.  Will this be the start of a new trend for some pairs?  

Included a 1/2hr skype call with Wayne.

Basically nearly all of the pairs are in some type of S1 or S2 setup. However some have yet to see a reversal. Others are going through a reversal period right now, and will require bullish/bearish price action before a trade can be entered. The pairs where I consider this to be the case are GU, GY, EU, USDCHF and CHFJPY and USDJPY (so yes, a lot of them). That said the only pairs were there is a big gap between strength and weakness, in my opinion are AUDJPY (am already in) and USDJPY for S2, and EURGBP, EURAUD and AUDCHF (am already in) for S1. Thus I ignore all the other pairs. Is that the correct thing to do?
AUDUSD – this looks like it would have been a great trade – I did consider going short around 94 something. But I decided not to because it would have comprised trading what I considered a mediocre pair against a weak pair – rather than doing strength versus weakness – so that’s my rationale for not being in a trade on that pair.
EURAUD – this was the pair where I stopped analysing yesterday because my head got to full with information. This also looked like a great trade – buying above the break of the previous high. I had considered that the reversal was good enough (even given the long bullish run-up) and that there was bullish price action.

Open Positions: I am currently in two positions – short AUDCHF – my short order @8780 got filled just prior to FOMC. I guess my trading coach will tell me off for having pending orders in the market at the time of the FOMC announcement (see my question on yesterday’s post as to when to pull orders from the market). The diagnosis on this pair has not changed. Should I move my stop giving that the trade has moved 220 pips in my favour (with 40 pips remaining to the target level)?

My short AUDJPY entry was filled sometime after FOMC after a big plunge in the pair. I am happy with keeping this position open as the diagnosis on this pair has not changed. On Daily charts, JPY ranks 2nd best and AUD is last. I consider that I am trading with the STAM.

Ending All in all, it took a lot less time to go through the analysis today. Onwards and upwards. I will need to make snap shorts of the charts of the trades that I have taken – maybe this weekend?

 

 

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