Getting Ready for 2012

Well its been a while since I've posted anything on here.  I've spent much of the past two months following the stock market more closely and trying to learn how to trade it, so I haven't focused much on currencies.  Starting fresh for 2012, I've tweaked my currency strategy a little bit.  I'll be looking for some more longer term swing trades (not much longer than a week maximum though).  I'm going to be focusing on only about four majors (EUR/USD, GBP/USD, AUD/USD, USD/CHF) because I think it will help me better learn these pairs and gain an edge.  My position sizing will be small, with much more focus on trading correctly than making money.  I'm planning on doing a weekend analysis each week of what I will be looking at for the next five trading days (Under the Weekend Outlook tab!)

I think that stepping back the timeframes I trade on will help me gain a broader sense of how everything is moving, rather than scraping up pips intraday.  I'll be much busier with school this semester, but I'm hoping to get at least 2-3 posts a month done on top of the weekly analysis.  Good luck to everyone this week and this year.

Back at it USD/CHF 8-29-11

Well now that work is done and school's starting, I'm back into trading during the day.  Just paper trading this week to ease back in and feel out the markets, but I figured I'd review a trade I made this morning.

The dollar franc made my watch list last night because yesterday it had wicked above the 38.2% fib retracement from December '10 til early August.  We were also near resistance at ~0.8275 and a little bit further out the 100 day MA.  I figured with all this resistance on the horizion, there may be some good selling opportunities in the morning.

This morning I saw that the pair was nearing yesterday's high at 0.8240.  We began to consolidate just under this resistance around 0.8230 and I decided to get short targeting 0.8187 w/ stop above yesterdays high.  Caught a nice down move from there and I sold more at ~0.8212.  Resistance at 0.8205 held solid and we saw a nice bounce from there, so I manually closed half of my position and eventually was stopped out at 0.8217 for +8 pips.

I was pretty satisfied with this play for it being my first day back.  One of my goals for this fall is to improve on adding to my positions.  I think I did a good job of this today.  One mistake I made this morning was rushing my trade a little bit.  I didn't notice the resistance at 0.8205, and that would have changed my whole plan for the trade.  There was also a little uptrend that was carved out on the 5 min chart that I missed.  Had I seen this I would have seen that 0.8205 was a perfect spot to target for a quick trade like I was making.  I think it will still make it to 0.8187, but it won't happen the way I saw it playing out.  

I'm probably going to just watch the rest of the morning and get a feel for how everything is trading.  US Consumer Confidence will be out in about an hour, so heads up for that.  I'm hoping to be blogging at least one trade review everyday, so keep an eye out for those.  Good luck and happy trading.

FX Outlook 7/4-7/8

Alright, after a little camping trip last week I'm back from hiatus and ready to trade this upcoming week.  Since Monday is Independence Day here in the States, I'm expecting volume to be lighter across the board.  The US equity markets showed a very strong rally last week, but most of it was on lower volume and we're now entering the resistance area near this year's high's between 135 and 137 in the SPYs.  I'm not expecting a ton of movement in the US markets ahead of Friday's NFP data, but I think those numbers will be very important for the markets in the coming months.

EUR/USD

The euro gained on the dollar last week and appears to be out of immediate danger since Greek austerity measures were passed and are in good position to receive approval from the IMF for their next tranche of bailout money.  We look to be consolidating a little bit on the daily chart, and I expect most people will be trading the news this week.  As QE2 comes to an end & the Eurozone is pulling itself together at least in the short term, the dollar needs some strong numbers this week or it may continue to slide.

GBP/USD

The dollar also gave some ground to the pound last week, but the pair is still in a downtrend that's looking a little bit steep on the daily's.  Again, I think the beginning of the week may be a little bit slow but the BoE rate decision and NFP's at the end of the week should be a catalyst for movement.  I think we'll continue to move downwards in the short term mainly on pound weakness rather than dollar strength.

AUD/USD

Greek austerity has helped the aussie dollar a lot in the past week as many people's appetite for risk has returned.  Another strong week could put it up near yearly high's against the dollar, and we're still in a long term uptrend dating back to about a year.  This week we'll be seeing a RBA rate decision and employment data, both of which need to come out at or above expectations to keep this short term upmove going.  Anything under expected could lead to a bullish outlook for the aussie.

USD/CHF

This pair has been downtrending forever now, but we may have put in a little double bottom 0.8315.  I'm expecting to consolidate between this level and the downtrend line, but the mid-term outlook might hinge on this Friday's NFP's.  Also, look for some minor swiss data this week that may cause some movement, but Friday's numbers will be the most important.

That's probably all I'll really follow this week, maybe the NZD/USD as well since the kiwi has GDP numbers coming.  As always, the market's opinion is much more important than my opinion.  Trade what the market gives you, not what you think the market should do.  Hopefully I'll trade a little better than I played golf today (lets just say I definitely got my money's worth with how many swings I took), and I'm hoping to get one more post up this week at least.  Have a good holiday if your in the US, and good trading to everyone this week!