May 2013

We've gone from watching paint dry to seeing quite a bit of volatility over a very short time frame and therefore no new swing trades have been taken, rather the environment has been more suited to day trading albeit with small stakes and wide stops. My call for retraces across AUD pairs failed quite spectacularly and none of the pairs analysed last Week showed any signs of reversing throughout this Week and I'm currently paying for that with the AUD:NZD swing long teetering near its stop loss levels, currently showing a 120 pip loss.

It has been a Week since my last Blog post and  the drop in traffic to the site after 3 or 4 days without an update is fairly significant, but please remember, I only want to talk about stuff that's worth talking about with a view to an imminent trade. I go through many charts each day and do miss a fair few set-ups that turn out to be great ones but don't see a lot of point in talking about great trading set-ups unless I'm prepared to put my own money on them. I'd rather do this than flood the site with advice or recommendations that I simply don't feel absolutely confident about  investing my own money into.

Having started the Week with absolutely no idea how things were likely to pan out it seems surprising that I've now got a bulging watch list! Strange how it works out. Other than the NZD pairs discussed earlier in the Week, nothing is quite ready to talk about in detail just yet but I continue to watch. Yen pairs were something I wanted to stay away from but in hindsight I've probably been mad to ignore them. I mean, BOJ are pumping $80 billion worth of QE each Month and will continue to do so for as long as it takes to boost their flat economy. This is probably something that shouldn't be ignored although my concern at the time was that it broke G7 rules but if anything the G7 are supporting it.

Following overnight news that RBNZ have been selling NZD due to their belief its over-valued with a promise to continue intervention as necessary, I decided to take a closer look.

GBP:NZD

When trading this pair I find MACD very helpful. With regards to the long side, I would analyse as follows. Cons: The Weekly candle is up against the 20 MA, quite a common retrace level in a Weekly trend. Also, my downside target of 1.71 hasn't been achieved yet so I'm not convinced a long term low is in place, but a medium term one could well be.