Jan7 – Market Analysis

Personal observations

2nd day in the new trading office by Old Street.  So far so good!  Spent the day yesterday looking over the various currency pairs – I do feel like I have absolutely no idea what is going on, after just two weeks away from the screens.

An interesting development over the festive period is that a broker has asked me to do a 30min talk on FX options at the IFX conference in Macau – so that should be exciting.

Equities & Gold

Similar patterns across the various European indices – some retracement over the festive period, and now price is pushing back to the previous highs – there have not been any setups in terms of STAM – the retracement have not been significant. All except DAX are starting to have bullish weekly momentum. It would require me to take long positions on the basis of other strategies (such as Turtles or 50/50, or options) to enter an order here.

No trades to take at this point.  Note that for now I am primarily looking at the D and W charts – rather than taking time to look at the 4H charts as I do for FX.

No setup on Gold.

STAM Analysis

I continue to be confused by some of the rating points.  The NZD and USD ratings are changing around significantly for the last 2-3 days (based on mix of actual observation from the STAM dashboard and my own data analysis using the FXCM feed for when I was on holiday).  I checked the NZD and USD charts, and on several of them, price is in fact trading right on the 89MA – thus it is feasible to points to change somewhat from day to day.

GBP and EUR are the strongest (14 and 10).    In the middle we have NZD, USD (both have been sitting in the middle for sometime) and CHF (which has been weakening).  In the weak camp we have CAD, JPY and AUD.

Going through the 4H & D charts, looking for setups, focusing on strength/weakness combinations – there are three potential setups (all involving the Aussie):

GBPAUD & EURAUD – corn-trade setup on 4H chart, strength v weakness – no major news for today/tomorrow.  Neither of these setups look ideal from the corn-trade perspective because the fast moving average is moving down still (rather than flat or rising) and the candles didn’t close near the tops, instead leaving upside tails in each case – implying that there is not a huge amount of momentum right now.  Thus I will not take trades on those for now. 

AUDUSD – corn-trade has just completed.  Trade entered – see blog post below.

I need to remember to isolate my strategies – for a STAM setup there are several requirements – and these must be fulfilled before an order is entered into the market.  Thus, even though I do have biases on certain currencies, and am thinking of other strategies for taking those biases, I need to be strict with STAM requirements for STAM setups.

S3 Analysis

There are currently 14 pairs with S3 potential – no setups at this point.  Will check again on the close of the various 4H candles.  GBPNZD might be a good one to pursue once we see some bullish price action.

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2 Responses to Jan7 – Market Analysis

  1. The EURAUD trade is moving nicely now – there was in fact EUR CPI at 10am – which I missed to identify ahead of time, most likely because I had filtered the EUR news out on forexfactory. In any case I had concluded that the corn-trade setups were not good enough, so I made the right (and disciplined) decision.

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  2. Completed another S3-FX review on the close of the 7pm candle – nothing setting up at this point.

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