Good Afternoon from the Canary Islands. Patience & discipline paid off last week with a decent couple of days which yielded 100′s of pips.That is why I always recommend that you wait until price comes to us as per the Plan the Trade. Trade the Plan video in the LMT section.
Similarly the LMT has been very quiet most of 2010 and yet suddenly 10 days ago we had some major moves that yielded many, many 100′s of pips. remember you are only aiming to make 20 pips per day /100 per week, so you do NOT HAVE to trade everyday.
The markets in most pairs are trending sideways now after major major moves. This is normal whilst traders pause & try to decide where to next. As you know trading with the trend is the best way to prosper at forex BUT we had decent months in August (when most people are failing badly) and again at Christmas by simply trading bounces off area of support & resistance.
A lot of the recent moves have been heavily news led, more so than normal. The next few days are very light as far as important, scheduled announcements are concerned so tomorrow may see price bouncing around whilst traders decide on a direction. It is also the first opportunity that Asian trades will have to put their perspective on the NFP Friday news, this could lead to big gaps again at market open.
Personally even for trades I plan to make off weekly charts I still wait until the market has opened and traded a while before placing limit orders. Everything can change so especially be watching for bollinger bands for clues.
M1 The Monday after NFP friday often sees big moves in the Asian session that kill this method. However you never know until it happens. I will take a peek at London open but will not get up early for this one.
Lmt: Lots of potential moves forming for next couple of days on the daily charts. If these current pullbacks then continue their moves, these could be decent sized ones. Patience!
Gbp/$ Took a beating last week & then pulled back well above the HUGE psychological level of 1.5000. So, is it a reversal or just a pullback? I know no more than you!
If it is a pullback then I show you in the video how recent down moves on the daily charts have been for an average of 1000 pips
On a weekly chart I am looking to short at 1.5550. On the daily I will be looking for short entries around 1.5400. This is 61.8% of recent moves, daily trend line , psych levels etc. I would look to long if price gets back down to 1.4760 area but only half stake as it is counter trend.
So my overall bias is a pullback followed by further move down, however to get a pullback price obviously has to move higher 1st so I will also consider longs at 1.5000. This is a bottom trend line, psych level & recent support. Sorry to be so confusing but all traders are in the same situation at the moment. Is it going up/down? If you are not sure walk away & wait for tomorrow to give clues.
Euro/$ Bouncing between 1.3735 & 1.3440 for the last 3 weeks. We have now had spinning top/indecision candles for four consecutive weeks as price has simply bounced along the monthly 55ema. Until price breaks these areas and forms new trends we only have the option of considering these same areas again. Equally if price does break upwards the move could be limited to 1.3800 so I would definitely be interested in shorting there.
Chf/$ Lots of opportunities last few weeks to short at 1.0860 with stops just above 1.0900. Looking for shorts there again. We initially had longs at 1.0700 but price came down as far as 1.0660 (weekly 55ema) later in the week so consider longs there again. If price does break here then I will definitely look to long around 1.0575 for multiple reasons.
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