Nov18 – Market Analysis

Personal Observations

STAM and S3 has been very tricky for me as of late.  I have had not had a trade (neither STAM nor S3) since the 6th Nov, and that’s across 28 currency pairs.  I hope that it’s not a case of me not doing the analysis correctly.  Additionally the results of the completed trades are rather bismal.  Remind you, most “market wizards” this year are also having a tough time, with most of them losing money!

In contrast, JBT has been a very good experience over the first three weeks of trading.  I have completed 58 trades (am 29W-27L-2BE) with average RR of 1.29 and an implied edge of 18% – which is rather phenomenal – up 6.65R thus far.

I will continue watching the markets closely for STAM and S3.  No need to give up right away.  However I do find that the much higher frequency of trades, that I am getting from JBT, makes me feel much more confident and comfortable as a trader.  Note that I am also using the STAM findings in looking at JBT trades.

However, I am finding working from 6.15am-10.15am and again from 12.45pm-3.15pm, as well as doing other currency trading work around that, is taking quite a bit of energy!

Equity Markets

These continue to rally.  Many markets are making historical highs.  Nikkei rallied 8% over last week (and is nicely in line with the USDJPY chart).  Gold is trading around $1,285.

FX Markets

Weekly Momentum changes – EURJPY, GBPJPY and CHFJPY have turned bullish.  Many AUD pairs have turned against AUD – AUDJPY, EURAUD, GBPAUD and AUDCHF.  GBPCHF has turned bullish.  So in summary weekly momentum has turned against AUD and against JPY.  And between these two JPY has turned against AUD.

Thus, in terms of momentum points we now have AUD on just 1 (down from 5 last week).  USD still strongest on 7.  EUR and CAD on 5, GBP on 4. CHF and JPY on 3.

In terms of STAM points – also some changes there – NZD up to 13 (from 11),  EUR and GBP both down to 11 (supposedly against NZD), and AUDUSD gains one point against USD.  In the weak camp we have CAD (3) and JPY (0).  In summary things that are strong, that i want to buy, are EUR, GBP and NZD.  Things that are weak are JPY, CAD.  I am neutral on USD, AUD and CHF.

There are only a few S1 setups – all of them are S1B. 

  • Yen Pairs – Four of these involve JPY.  JPY has retraced a little from the time it opened on Sunday night – but these retracements are quite small.  However looking at the 4H chart of the JPY pairs for the last week – there really have not been many retracements, instead JPY has just weakened and weakened throughout the week.  So it is probably unrealistic to expect significant pullbacks on the JPY pairs.
  • GBPCHF – no significant pullback yet.
  • GBPAUD – seeing a pullback in progress here.  I now just need to wait for bullish price action on the 4H chart.  This would be a strength/weakness combination.
  • USDCAD – great pullback in progress here.  Wait for bullish price action.

S3 Trades (ignoring equity markets for now, as I seem to have enough on my plate already!)

There are quite a few potential setups.  The shortlist contained three NZD pairs and two AUD pairs.  The NZD pairs would involve shorting NZD which would go against the STAM (NZD has 13 points!!).  However the two AUD trades are valid setups.  I will these with the same R size as I am taking with JBT (£100/trade).  These are trades buying EURAUD and selling AUDCHF – charts to follow shortly.

Next action

  • STAM – Monitor GBPAUD and USDCAD.
  • S3 – Check S3 again at 3pm.
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One Response to Nov18 – Market Analysis

  1. 3pm update: No further action to take in regard to potential STAM or S3 setups.
    Note both of the S3 trades taken on the close of the 11am candles are currently in profit (20-25 pips each), thanks to AUD weakening. Check trades again at 5pm to see whether I could shift the stop to entry level.

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