I’m Targeting These Levels On Thursday
FX markets pulled into obvious
retracement levels thru the midday after posting very profitable (potential)
moves overnight. With Jobless Claims or whatever employment drivel report {does
it really matter which?} hyped in the media as next big thing for traders, we
might see some sideways consolidation into the wee hours of Friday morning.
I’ll still be targeting layers of price magnets
in the bigger intraday charts, seeking high-odds pull back entries should they
offer themselves up to us. Other than that, it’s been one big trader’s party in
the FX markets for weeks now!
EUR/USD (+$10
per pip)
Euros staged a nearly +200 pip move from lows
to highs today. After that type of directional pop, we usually see some type of
consolidation before the next push or reversal. I’m looking at initial support
magnets near 2275 and lower support near 2225 if touched. Given the chance I
will buy both, with procedure of managing trades described in the educational
section below.
GBP/USD (+$10
per pip)
British Pound? Same story. Buying 7760 first,
7715 after that. Should both of those trades fail to work, I’m idle into
Thursday morning’s pit session for currencies at the earliest.
USD/CHF (+$9
per pip)
Swiss Franc is a sell at 2680 and then again
near 2715. Both stop out on me… idle until Thursday morning or beyond.
USD/JPY (+$9
per pip)
The Yen is on sell signals near 111.30 and then
111.45 on a lift into layered resistance. Same M.O. as the other pairs profiled
above.
{Price levels posted in charts above are
compiled from a number of different measurements. Over the course of time we
will see these varying levels magnetize = repel price action consistently}
Controlled Aggression
It didn’t take long to learn that
trading the FX, or should I say attempting to trade the FX in
hyper-kinetic fashion did not work for me. There is a fine line between hitting
all the good trades, and hitting everything that resembles a good trade. I’d
guess that the number one mistake most FX traders make is trading too much.
Heck, I’m still a tiny bit guilty of that myself from time to time.
Inside tonight’s charts we have two zones per
symbol of roughly equal chance for trend continuation success. The nearer to
current price action levels (1 arrows) are taken using -20 pip stops, while the
farther levels (2 arrows) use -30 pip initial stops. Why? I’m so glad you asked!
Should these trend moves still have some gas in
the tank, those first marks on the chart are likely to hold without much (if
any) price penetration. Therefore, the tighter stops usually work well as more
relaxed ones.
If the trend moves need a rest, if they pull
back to the deeper mesh of price magnets, things could get a little sloppy
around there. I prefer to use a slightly wider stop at deeper levels of pull
back support = resistance layers, expecting them to be make or break kind of
trades.
Times when both of them stop out like the
proverbial knife thru butter (or dollars thru a new FX trader’s account?) I
merely stand aside and wait for the next clear trade signal to emerge. Losing
-50 pips on two tries at key locations on a chart are offset by a nearly equal
number of +50 pip to +120 pip profit runs as well.
Those winners usually take care of
themselves… avoiding too many losses and cutting them short in the process is
a balanced act anyone of reasonable intelligence can learn in time, if you ask
me.
Have a great night, and we’ll see you here
again on Thursday evening.
Trade To Win
Austin P
Austin Passamonte is a full-time
professional trader who specializes in E-mini stock index futures, equity
options and commodity markets.
Mr. Passamonte’s trading approach uses proprietary chart patterns found on an
intraday basis. Austin trades privately in the Finger Lakes region of New York.