Marc Walton on May 12, 2013
Hi,
mixed results last week. The Cad finally paid off for well over 100
pips after I had waited nearly 3 months for the entry, now THATS what I
call patience and discipline!The Aud on the other hand spoiled almost a years decent % wins, I lost twice on it last week. The second time I was taken out by a handful of pips and price fell 200
The ability to cope with horrible situations like that and simply move on to the next trade is a hard task to master, but its vital that you do. Earlier in the year I had a Yen trade taken out by 1 pip that subsequently went a 1000 pips, I don’t think about it anymore (after my therapist talked me back off the ledge)
It happens, but as we say here at fxmp, www.moveon.com !Last week saw a lot of dollar strength and some breaks of major areas. This weekend saw a G7 meeting and we have Euro meetings coming up, so how best to play the current markets?
I will watch the market open for potential gaps (if you are new or need a refresher, here is one of the ways I trade gaps: Marc’s Gap Trading Strategy but I will then wait until London opens before placing trades. The Euro for example just broke major support at 1.3000 – will it bounce back here or drop like a stone? I have no more idea than anyone else, so the logical, most sensible thing to do is wait and see how the big traders react and where they intend to send price next.
The major banks and financial institutions control what goes on on the markets, we simply need to hang on and pick up a few scraps that they leave. Personally I will probably leave the Euro alone this week (except for gaps or a definite move). My best advice is concentrate on a few pairs, unless you are trading a system like Deans STT where you are looking for a clear pattern.
If you worked for a bank or hedge fund you would probably only trade one pair! I show in the video how there are multiple opportunities on the Euro/Gbp and the Gbp/$ this week. Those pairs alone should be enough to achieve my weekly profit target.
Forex Week Ahead
We do not know how the markets will react to the weekends G7 meeting so I will wait until after London opens to trade. I have a lot of “either or” possibilities this week. For example the Gbp is at a crucial area right now. Whichever direction price goes it has the potential to move many of 100′s of pips, therefore you need to be flexible in your planning…. “If it breaks I will look to short, if it bounces back up I will long”.
Gbp/$: Crucial area. From longer time frames my preferred, forward order trade is to short at 1.5780 for multiple reasons.
However this pair has a lot of potential smaller time frame trades. Price is currently stopped at a daily trend line that goes back to February. Recent moves back up from this line have averaged 300 pips. I will watch 4 hour candle closes for clues for direction. If price breaks and closes below 1.5300 (even better if its below 1.5280) I will look for an M2 pull back to short. If price fails to break and there is general $US weakness I will long anywhere around 1.5320.
The top of this channel is 1.5600 where price rejected last week so thats yet another potential trade on this pair.
Euro/$: Very messy. I prefer the Chf at the moment. Main preferred trade is to short at 1.3300 however that seems a long way off right now.
Intraday A CLEAR break and close below 1.300 might get me interested but 1.2900 was strong previous support. Also 1.3050 bounces back down, but not for me.
Euro/Gbp: I showed in Wednesdays video how I used the M1 method to long this pair just above 0.8400. I show in the video how to look for candle stick clues to do so again. My preferred entry is to short at 0.8480, just below major support, emas, fibs around 0.8500 that worked well in recent weeks. Final option is if price breaks and CLOSES below 0.8400 I will look for M2 pull back entries to short.
Chf: On Friday price broke major support of 0.9500 which is now the logical area for a pull back to long.
Aud:I was taken out of a short last week that then went 200 pips, logical entry for me is to short at 1.0180. Just below 50% weekly fibs and previous support.
Aud/Yen: Tight range as its being dragged up by the $USA and down by the Aud. I prefer the $/Yen this week, but watch 100.00 for a bounce back up from 4 hour charts
Euro/Yen: Making new highs and bullish but I need a bigger pull back, 127.00 is still the zone for me.
$/Yen: I am only interested to long, 100 is the place for a pull back after a major move up.
Cad: Worked perfectly last week, but still messy but 1.0020 is my preferred entry once more. Its the psych level/parity. Strong previous support & resistance. 61.8% fib and the weekly 55ema – did someone mention multiple reasons! Longer term a short at 1.0250 is also on my radar
New members please note: If I am looking to take a trade long, at for example 1.6000 , I place my order 10 pips above & 10 pips below for a short. This is because price often does not quite reach a major line and you need to allow for spreads.
We are NOT a “tipping service” our aim is to teach you how to trade for yourself. For more up to the minute updates do not forget to drop by the forum
Pierre, Vassilis (Capsmart), Raa, Omar, Mary, and other experienced members will be available in the forum to give you a more up to the minute assessment & whether they see any potential trades lining up in the next few days. Many members tell me this is the best forex forum there is (no back biting & bitchiness, nor spam, that spoils most forums) and all members are happy to help new visitors. Its a great resource, USE IT: Forex Forum