July 2013

A lot of indecision from me this Week! The 2nd half of the EUR:AUD swing short was closed for a loss of -180 pips. Taking into account the +321 points taken on the first half of the trade, this gave an overall aggregate profit of +141 points. It's a real shame this trade didn't work out because technically everything looked good. Of course its possible that it will still reverse as the previous major swing high hasn't been decisively taken out, but the chart does look much less bearish than it did when the trade was taken so probably best to be out in the short term.

With low volumes and little going on in the markets things still remain quiet. The 2nd half of the EUR:AUD short is still running and went into the Weekend showing a loss of around 70 pips. I'm preparing myself to closing this position if it rallies past the 61.8% retrace of the current short term swing move. I'm also quite relieved I took half profits when I did even though at the time I was worried I'd regret it. Apologies for not having put this trade in the trades log yet, totally forgot about it!

GBP:CAD is currently trading in the middle of its long term trading range but has shown some potential for a possible move from here to the top of its trading range which may provide a short term swing long set-up. The 4 Hourly chart shows the recent leg down to have found support at the 61.8% fib retrace from the last major swing low to the recent swing high. For a potential long entry this would likely become the area where stop loss positioning should be considered.

No new trades were opened this Week as the mid-Week analysis for both FTSE and USD:JPY has thus far failed to materialise. I closed half the EUR:AUD swing short for +321 pips and left the other half to run. It was my intention to bring the stop loss down to breakeven but i didn't do it straight away and when I next looked at the chart I couldn't believe how fast it had rallied and the 2nd half of the trade is now showing -150 pips. Basically we've seen a 500 point rally in just a couple of days. I'm quite concerned about the trade now so will see how things look tomorrow and may take the loss on the 2nd half. In doing so I should still come out of the position with an overall aggregate profit. Without doubt I'm definitely pleased I took half profits when I did as things could be looking much worse had I not done so.

Following my earlier post updating on recent trading I thought I'd post a quick snap shot of the USD:JPY channel back test I'm waiting for. Its not too often I post such set-ups too far in advance because there simply isn't enough on the chart at this early stage to support the trade idea but in short I'm simply looking to see how price reacts if and when it reaches the underside of the old channel with a view to entering a swing short. What you'll often see on such set-ups is a pip-perfect back test that instantly finds sellers, but some days later price will rally again and actually briefly break back inside the channel stopping out all those early positions. It is after this second back test that the real sell off will begin.

Another quiet Week with the only trade taken being a re-entry of a previous set-up on EUR:AUD. Since Thursday's sell off price has recovered a fair bit so it is now my intention to lower the stop loss to just above the 1.4290 area which will allow for a 61.8% retrace of the current "correction". I think strength above 1.4290 would suggest bulls remain in control and if a topping process is taking place it could take longer than anticipated. A stop out at 1.4290 would close the trade for a 50 pip loss whereas as things stand the trade is showing a profit of 80 pips.

Having closed the previous EUR:AUD swing short for a quick profit the time has come to take another look whilst price continues to struggle against Daily resistance. The MACD negative divergence has now confirmed itself and price breaks above the 1.4270 level appear to attract selling pressure. I was so close to entering short last night but at that time price was above 1.4270 and looking lively so the decision was made to wait until today. Price did drift lower overnight and my entry wasn't at the best possible levels but it turned out to be good enough.