I closed the short trade at 1.2157. I'm too tired to follow the market tonight. Hopefully, I'll have a sound 6+ hours sleep and be ready for tomorrow morning's US open. Happy trading! Chinook
This morning has been better than the usual this week. After the 830 EST spike, I shorted at 1.2102 and covered at 1.2084. The day's still young hopefully we'll see some more decent moves later on. Bonds are recovering, oil's down. Looks like a mixed bag to me right now. Chinook
Reshorted at an avg. price of 1.2085 with 8 pips tight stop. Chinook Covered at 1.2073. The move went 10 more pips after I went flat. I'll wait for a 14-18 pips rebound and reshort around 1.2075-1.2080.
If the conditions stay the same, my plan is to reshort when the price is 2 pips away from the black trendline in the picture. now that level is @1.2075. Chinook
First wave of shorts is entered @ 1.2071. If Eur goes down, I expect another 20 pips move for this leg down to 1.2050. Chinook Edit: Second wave of shorts is entered @ 1.2075. I will cover around 1.2085 but that is flexible depending on the "madness" of the buyers.
We may be breaking down from a L/T Weekly wedge, and violating an extreme trendline going back early 2002...In my experience, L/T trends do not reverse unless there is a change in fundamentals...perhaps the renewing of a hawkish Fed Policy is the catalyst for a correction, or perhaps the end of violence overseas and a positively resolved election with no terrorist influence(hoping more than anything else)...and in the longer term, a move to 1.09(projected from the 1.29 high to the 1.19 low) would only be a basic a-b-c correction while still not violating the overall trend...just my opinion of course...
Us $ bears have alot of fighting left in us! . Why do you say a renewed hawkish stance by the Fed? Personally, I believe that one HAS to be $ bearish here. In my opinion, this was never a EUR story. Rather, the $ has been in a weakening trend against every major currency in the world for 2 1/2 years. Take a look at the chart of the US $ Index, or, better yet, look at $/CHF. Which should I bet, at this moment in time the dollar is going to all of a sudden change trend and regain strength, or, the mere fact that the dollar is very near it's trendline provides excellent trade location to set-up longer term positions? I'd have to be pretty arrogant to think that I could pick the brief moment in time when the dollar makes a trend change that has been in place for more than 2 years. Big money accounts have alot of money riding on a weaker dollar. They will defend that position vigorously before throwing in the towel. Not saying it can't be done, just suggesting that it's not going to be easy to break this trend. With that said, it hasn't exactly been easy to trade with the longer-term trend the last week or so either. Typical market!
Buyers came in and blasted through my stops. Another quick short attempt got stopped out too. I shorted one more time. Chinook
Hey Trade-Ya, I'm with you...but I'm just showing what is developing technically...and doesn't it worry you a bit that all this money is tied up in a weakening of the $, think about the profits that have already been accrued with this 2 year trend...with a possible change in fundamentals(Fed likely to begin gradually increasing interest rates), maybe it wouldn't be that bad of an idea to take profit, especially on the break of a 2 YEAR TRENDLINE. And when one of these guys start, they all pile through that same door. I'm not saying that it will happen, but don't be surprised if it does...don't forget, the euro came out above 1.20 and in little time traded below .90, and everyone thought that trend couldn't change either...but please, if I've got a big figure in a trade I'm pumped and I move on...just a little long term analysis for what its worth...
I have to admit, while I personally do not doubt my longer term view, this has been one MOTHER F'ER of a difficult trade!!! I think that I am trading larger than I should be. Mistake. I do believe that I learned something from this episode thus far. While it seems intuitive to trade larger nearer the trendlines, it is often more of a difficult trade with tons of whipsaw action as the market needs to repeatedly scare out guys like me (and of course you get a contingent of people that are getting out prior to a decisive break of the trend for various reasons). Ultimately, in my opinion, this is the type of action that will really allow the trend to continue and extend once these battles are resolved. If one is going to be involved and watching the markets on a daily basis, trading more size so close to the trend line exposes you to extreme pressure and whipsaw action. This trade is going to be much safer, easier and more lucrative to buy a breakout on the upside of the 1.2370 area or therebouts.