Wednesday was a busy day. The DAX had been trending down strongly over recent trading sessions – finally approaching the 9,000 level. Round numbers are generally always big support/resistance levels. A lot of people place stops and entry orders at round numbers. The rounder the number, the bigger the significance. in the Dax, a round ‘000 number is pretty significant. Around 7am, the DAX was trading between 9,030-9,050 in the spot market. I ended up taking 5 trades over several hours, using either the 1M or 5M timeframe. Looking back there was a lot of “woulda, shoulda, coulda” but that’s how it goes. Only well in the afternoon did the DAX really penetrate the level making a low close to 8,950 – however by that time I was “traded out” so I stepped back. Thus with all of my trades I was essentially trading into and targetting the 9,000 level.
Here are the charts (remember you can click on any chart to make it bigger!):
I also took one short trade on Cable – there were several fx pairs that i had identified as trending and thus potential instruments to trade – all of this did kind of move – although I missed all of them – and the moves were not sustained – so if I had entered at the right time – I most likely would have ended up with scratch trade. Since I missed the timing, I ended with a loser on Cable. FYI – the five trending instruments (looking at the 15M charts over recent trading sessions) were USDJPY, Cable, GBPJPY, AUDNZD, NZDJPY and USDCHF (oh, and Gold!).
After all that very hard work I ended the day with 2 losers, 2 winners and 1 scratch on the DAX for +0.5R, and a loser on Cable for -0.85R. Thus a small losing day of -0.35R.
I also commenced the trial in the whichwaytoday trading room. This was all right. It’s not as well structured as the JBT trading room where I spent a lot of time from Nov’13 to Jan’14. On the upside there are four traders offering their views and analysis of a range of markets including fx, indices, commodities and bonds (so basically everything). The best part of the day was one of the analysts making Dow predictions on the basis of lunar and solar eclipses – given that he has been trading successfully for 50 years, I will need to give him all the credit he wants. I will give more updates over time.