This Week’s Swing Trading Review; 4th February 2012

This Week’s Swing Trading Review; 4th February 2012

You may have sensed from both the trades log and the mid-Week Trading update that I’ve had a fairly frustrating Week where choppy price action in my chosen trades repeatedly frightened me out of positions earlier than planned.

In the EUR:GBP and multiple EUR:USD positions specifically, I walked away with much smaller gains than had been available earlier on in the trade. You could argue that I’d misread the setups and therefore shouldn’t have taken them in the first place, or, you could put a case across that this is a disciplined approach where if the trade shows any signs of being wrong one needs to get out before a profit potentially turns into a loss. You can draw your own conclusion from that but now the Week has drawn to a close, I’m sitting here with a trading statement showing a number of small wins but no losses and that puts me in a better mental and financial position than if I’d held onto the trades to end the Week with some big wins but also some even bigger losses!

Ultimately Capital Preservation must be at the forefront of every retail traders mind.

So, moving onto the trades themselves. EUR:GBP had already achieved one of my longer term downside targets but entering short on the recent retrace looked sensible. On further inspection I decided there was a larger risk than anticipated of a more sustained rally. That rally certainly hasn’t shown any signs of materialising just yet, but I chose to exit the position for an 11 pip profit.

EUR:USD after hitting all time record short bets shows a possibility of being in a bullish consolidation phase. During the large consolidation some time frames began looking a little less bearish than when I first entered the position. To protect Capital I exited the trade for a 31 pip gain (having been +100 earlier in the day), then, the following day things were looking good again so I re-entered only to eventually see further bullish signs so closed that position for a 30 pip gain (having been +170 earlier in the day)! That’s where most of this Week’s frustrations set in, but, this pair is very sensitive to news right now and there are so many people on the same side of the trade a few alarm bells started ringing. Depending on how things go, I may even re-enter the trade next Week.

EUR:NZD was a more refreshing trade and played out perfectly according to my initial analysis. As it was showing a pleasing profit I chose to cover the position ahead of the non-farm payrolls number, also bearing in mind that further Euro news over the Weekend could potentially see a sudden change of direction. In total 103 pips profit were taken, but in the event the NFP number would have actually taken it to a +300 pip profit.

A GBP:CHF long entry was taken on Friday and you can read a full analysis of that below this post.

Most of the Elliott Wavers appear to be looking for a Stock Market sell off commencing early as Monday as Indices reach the termination of the current wave 5. I don’t really subscribe to Elliott Wave but when they all unite on an idea I think it worthwhile to play a little cautious in case it does play out or until they change their Wave counts to something else.

Looking ahead to next Week and for the first time in a good few Weeks my Swing Trading Watch-list is buzzing full of ideas so there’s plenty to talk about and I’ll look to get some of those ideas on this site ahead of Sunday evening’s Market opening.

Any trades I take are always posted live on my ADVFN forum so if you don’t already post on a trading forum you are welcome to sign up. Some say the forum is more of a dislocated family rather than a technical trading forum, others say it just passes time (trading is a lonely job after all), and a few say  the ideas presented have helped their trading. I’ll let you decide by posting this snippet of conversation that took place last Week and had me giggling to myself:

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joe – 25 Jan’12 – 16:20 – 129902 of 130568 

looks like a wave 4 to me

xxxx – 25 Jan’12 – 16:26 – 129903 of 130568 

*waves to joe*

yyyy- 25 Jan’12 – 16:27 – 129904 of 130568

what the f*ck is a 4 wave. I need a f*cking tsunami DOWN

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Have a great Weekend.

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