Update & Analysis On Blog Trades & Pending Trades

Update & Analysis On Blog Trades & Pending Trades

It’s been a manic week in the markets and a quiet week on the blog, so why’s that?

Well, day trades aside I’ve been sitting on my hands because all open positions were performing without the need for attention and there’s presently nothing new on the watchlist.

I started the week with a marginally bullish bias on Indices and viewed Sunday/Monday’s huge gaps down as buying opportunities for the gap fills at the very least. As posted on Mondays comments I entered FTSE and DOW longs all of which were closed on Tuesday once gaps were filled and it became apparent there was not enough momentum to break to the upside  out of the huge daily ranges. From then on I switched short as day trades and closed all short positions last night on the U.S market close following FOMC.

After a failed effort to get short NZD:CHF for a pull back from overbought status I closed 2 positions there, one for a small gain, the other for a small loss. That was followed by another huge spike up on Tuesday night, so I re-entered Wednesday morning and got the move I’d been looking for.

Although I was looking for around a 200 point pull back, I was fortunate to bank a profit today of 274 pips with the exit being an area that may (or may not) become support as shown in this chart:

 

The star trade of the week without a shadow of doubt must go to the USD:CAD set-up and I really hope some of my readers managed to capitalize on this great move which achieved and exceeded my upside target in just 4 days, not bad for a trade I expected to hold for a couple of weeks!

This chart shows the combined Fib level and resistance that signalled my exit of the trade for a gain of well over 400 pips – A move that can often take Months with this pair!

This updated 4 hourly chart shows just how crucial, and how sensible it was to wait for a retest of the green 4 hourly MA before committing to the position – and the full scale of the fantastic move that followed:

 

 

Not every set-up went according to plan, and I was disappointed to have missed out on the failure of the AUD JPY Box Trade to achieve my desired entry level, instead, selling off from the 61.8% Fibonacci level. I watched it happen, but just didn’t manage to get an entry with everything else that was going on:

 

Having been so heavily involved with the wild volatility we’ve seen, I’ve just not had chance to hunt out any new set-ups so will make an effort tomorrow to find some and get them posted on the blog ahead of next week.

In the meantime, for me, this has actually been by best week ever based on trades that were both opened and closed this week. Based on points banked, Wednesday was the biggest points gaining day of my 4 year trading career with in excess of 600 points banked – and  that is despite an intraday FTSE short being stopped out at the highest pip of the day prior to a 300 point sell off! I did re-enter the position 50 points lower so all was not lost. Overall for the week,  after deducting losses, a profit of 1276 pips have been made.

Ok, that is more than triple my average weekly gain, but I can tell you now, there are premium subscription blogs out there that charge a lot of money to provide analysis and trading signals to members, and over 1 Month most will not come anywhere  close to the gains we’ve made here just through this week alone, all based on simple analysis that anybody can do at home by themselves.

Don’t get me wrong….there will be bad weeks, but whilst the sun is shining, let’s make hay!

In the meantime, I have no open positions and don’t plan to open any swing trades for the remainder of this week.

3 Comments
  • Trading FTSE
    Posted at 13:53h, 23 September

    Well played RS! Excellent bit of swing trading there and fantastic results. What kind of stops do you normally have when you place your trades, and what is the level of risk to reward ratio that you look for?
    Keep up the good work,
    Tony

  • RS2OOO
    Posted at 00:42h, 24 September

    Hi Tony,

    Most of the stop loss levels are quoted in the individual posts detailing the entries. My risk/reward varies greatly dependent on the type of trade. If taking a position from a channel or trend line, then the stop can be as tight as 10 – 20 points based on the fact that if the trend line is broken, then my reasoning behind the trade is likely to be wrong. With this kind of trade I’m very particular about getting the entry bang on the trend line, if I miss it, then I don’t take the trade. This allows for tighter stops.

    If it’s a medium term swing trade where there are 3 or more solid technical reasons for taking the position, and no obvious reasons why it could fail, as well as fundamental evidence to support the trade, I could then run stops as far as 200 points away as I did with the AUD:NZD long a couple of weeks back – that position actually got stopped out, but immediately bounced and has rallied ever since! With such trades, the reward would be a minimum 1:1 ratio, but I don’t actively evaluate risk/reward with every trade because my trading style doesn’t require it as I’m usually quick to scrap a trade that doesn’t do what I expect right from the outset.

    For scalping, my risk reward is very poor in that I can consistently win 8/10 scalps, but one losing scalp can cost me the profits of 6 of those wins. I have a system for scalping, but it only works in certain market conditions. Sometimes it’s hard to recognise if those conditions are right, in which case if I lose 3 scalps in a row, then the conditions are not right.

    I do have a rule that allows me to let risk/reward look after itself….. For every trade there must be at least 3 solid technical reasons for taking the position, and if 2 of those reasons change whilst the trade is in progress I instantly close the position if it’s in a loss, or pull stops to break-even if it’s in a profit.

    An example of 3 solid technical reasons when entering a long position could be, 1) Trend line support, 2) Horizontal support, 3) Positive MACD divergence.

    If 2 of those become invalid, the trade is cut. I don’t always stick to this rule, but I should do, and if you do you’ll be amazed at how many losses you’ll avoid. It’s a very good rule, but does occasionally keep you out of a great trade, but it also keeps you out of a lot of not so good trades.

    I’ll regularly take a position and feel differently about it once I’m commited and decide to take a small loss. The NZD:CHF short earlier in the week was an example of this. I took 1 trade, didn’t like it so closed for a 32 point gain, then later in the day I had another try but price kept finding support so I took a 35 point loss. The following day things were looking better so I tried again, walking away with almost 300 points profit in just over 24 hours.

    Although it’s been a great week, it has to be said that just sometimes there will be a period where absolutely nothing seems to go right and I end up scratching my head trying to figure out what the hell is going on!

  • Full Swing Trading Watchlist for October & November 2011
    Posted at 16:48h, 15 October

    […] It would be great if this can keep dropping back to the support line shown on this chart. To get a freebie second go at this long trade would be a  dream after the results of the first one: […]