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Missed opportunity review: GBP/JPY spiked 500 pips in 24 hours

Posted on 15 Oct, 2009 in European Crosses, Self Assessment, Trading Signal | 0 comments

It looks as though my analysis for GBP/JPY making a reversal was correct. However, my short term entry needed to be improved for me to profit on my intermediate term analysis. In particular, I should have looked at a major short term resistance line instead of an arbitrary weak resisitance line as I did when I entered the long previously. That didn’t go so well as I was stopped out soon afterward when GBP/JPY was consolidating.

In hindsight, if I’m to try for a reversal, at least wait for the price to break a strong short term resistance and then use the recent low as the stop. The preferred resistance line for GBP/JPY in this missed trade can be seen in Fig. 1, which I drew many days ago and also can be seen in my previous entry (Figure 2 on that page, the higher of the 2 lines). New Figure 2 attached below shows the bigger picture of GBP/JPY in a daily chart to see what could have perspired. My target of 148 was spot on too!

GBP/JPY, 3-hour

GBP/JPY

Paper trade: Long EUR/USD 50% @ 1.49212, stopped out @ 1.4875 (-46.2 pips)

Posted on 15 Oct, 2009 in Major Pairs, Trading How-tos, Trading Signal | 0 comments

EUR/USD looked as though it was going to break through 1.50 when it broke 1.49 (Fig. 1). I waited til it marked a short term top at 1.4920 (Fig. 2) and then placed a stop entry just above it at 1.4921. EUR/USD traded above it for a few hours but failed to break 1.4970. It has now retraced to a short term support. If it continues to decline, the double divergent top will be all written over the wall (Fig. 1) and it’ll be a good short for the next few weeks. Until it moves out of this trading range though, this is still an uncertain trade.

On another note, I have now had a string of 7 consecutive losses. Good thing these are merely paper trades for experimentation. Looking over the history and statistics, it’s apparent that many of these trades were taken to try for the top/bottom just after signs of reversal in the short term (except for this EUR/USD trade, which is with the trend). Thus, from now on, if I’m to go against the intermediate trend (daily), limit my position size by reducing a 50% position size entry to a 33% entry, at most. Furthermore, only enter when the instrument has marked a short term lower top and has broken the immediate support.

After paper trading for a month, my forex trending strategy is finally starting to take shape…

EUR/USD

EUR/USD, 3-hour

Week of Sept 20, 2009: In-play stocks watchlist

Posted on 20 Sep, 2009 in Stocks, Trading Signal | 0 comments

Out of this week’s 10 candidates, I’ve only been able to identify 4 that are presenting playable setups.

Christopher & Banks Corp. go long above $8.10. Stop at $7.70. Target $9.00.

Week of Sept 13, 2009: In-play stocks breakout results

Posted on 20 Sep, 2009 in Stocks, Trading Signal | 0 comments

Last week, I identified 5 stocks with earnings release scheduled for the week and with obvious setups for a breakout. They are AIR, APOG, CKR, DBRN, and MLHR. Of which, AIR, APOG, and CKR have inched up steadily. DBRN’s up trend was very choppy. And MLHR was way too much into a move already for me to enter. So of the 5, 3 would have been profitable, 1 stopped out, and 1 passed.

Apogee Enterprises Inc. (APOG) in particular is worth a note because it literally went vertical. However, I probably would have exited when it touched the $15 resistance.

I believe the key to this week’s good results is that the overall market is very bullish, at least in terms of the public’s sentiment. S&P 500 made a marginally new high above 1070 without any retracement yet.

Thus, the moral of the story here seems to be just go along with the market trend regardless of any rationality.