USD

Having day traded the short term range in GBP:USD throughout much of last Week, this morning I entered a long, initially planned as a day trade but after further thought decided to give it some breathing space, albeit with one eye regularly checking up on it. The main trend is clearly down and has been for some Months but a time has come where practically every time frame is showing almost extreme levels of positive MACD divergence. This in itself is no guarantee of a reversal, but should lead to a correction of some kind, and even a weak correction is still adequate to take 100 pips or more.

Firstly an update to my previous post where I cited GBP:NZD as the favoured swing trade from my watch list. Yet again it performed as expected but yet again I didn't enter the trade due to my focus being elsewhere. However, it may not be over for that pair and I do continue to watch it in case it develops into a larger and more sustained move down but clearly the safest entry point for such a move has now passed. If you took the trade yourself than a trailing stop would probably be a sensible precaution maybe 200 to 250 points above the current print of 1.9745

You may recall my recent choice to take a risky trade in AUD:NZD whilst waiting for a EUR:GBP set-up to fully play out. Obviously I could have entered both trades but on the basis that the EUR:GBP set-up didn't look quite ready for entry, and the AUD:NZD despite being far riskier did, I just went with the latter. Unfortunately for me, the EUR:GBP short would have been an instant winner, whilst the AUD:NZD one is yet to show a profit of any kind! In fact I widened the stop slightly on the AUD:NZD long on the basis that my original stop placement didn't leave enough breathing space. At present the AUD:NZD position is showing a loss of approximately 140 pips whilst the EUR:GBP trade, had I taken it, would now be showing +180 pips!

As the Week started with uncertainty over the debt ceiling situation I chose to have a lazy Week to avoid jumping into trades I may regret! Of course this was despite the debt ceiling conclusion being pretty predictable. The DAX swing long is still running, showing circa 380 pips profit based on current futures pricing. Whilst I didn't swing trade the last Week I have had my eye on a few charts so here's a brief run through of a couple of the more interesting ones:

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.

One new swing trade was taken this Week in the form of a EUR:AUD Swing short. In view of the risk attached due to there being very little technical confirmation that I'd be able to pull the trade off, I decided to close it and go flat into the Weekend with a view to re-opening it next Week when further confirmation is in place. The trade delivered 120 pips profit in less than 18 hours so the result was quite satisfying. If and when this trade is re-entered I'll post details in the comments section under the relevant supporting post.

USD CAD caught my interest after the FOMC announcement tonight and on inspection I was surprised to see its been trending upwards since September of last Year.  In fact you could argue its been trending up ever since July 2011 although in reality its been pretty much range bound. The area around 1.0253 has been marked on my chart as S/R for a considerable length of time and its fair to say price has been through it in both directions numerous times before but breaks above that level do seem to coincide with short bursts of strength that propel it 150 - 200 points higher relatively quickly.