What Is FX: Can You Spell Flexibility?
Restored from the Empower Network archive (2011–2017), lightly edited to meet our current advertising standards. Views are the original author’s.
What Is FX Daily Report
What Is FX: Flexibility In Trading March 21, 2012
11:00 PM EST
Good evening What Is Fx traders: our usual late Wednesday report is now in your inbox! (Of course, you already knew that as you have it open and are reading it now.) Our Bible Studies at the church seem to grow longer by the week, and I’m not the one doing most of the talking. So it’s always an enjoyable time. Lot’s of cake, cookies, and coffee don’t go unconsumed either.
At any rate, it always amazes me how one alert leads into another, and this one is no different. What Is FX was looking at the theme of flexibility in a day’s trading plan earlier today, and then today we had a crash course in flexibily in trading the euro. But the truth is, there’s a difference in being flexible and trading an impossible market. Undoubtedly, there were people who made money today. But there were a lot more people who lost out. On any given day that is true, it’s just that What Is FX hates when it is true of us! What Is FX had a handful of trades that were break evens, but we were already set up on a nice long when the market suddenly dropped down and stopped us for a small loss, then What Is FX turned around and went long, only to get stopped out again, then What Is FX went short one more time, only to watch the market whipsaw once more and begin a slow climb for the rest of the day. Bummer.
What we am getting to is that some markets are very hard to trade intra-day. This was one of them. Since intra-day trades generally have more leverage, it is unwise to let them move against you fort very long. Set your stop and get out. The first loss is the best loss. But rapid whipsaws like we saw today, are only really tradable for longer term smaller position players, and in the end they could have endured the whipsaws, but the price didn’t really change all that much. Sometimes this is referred to as market noise. And as a rule, this rarely happens 3 times in a day, and often you can be pretty comfortable going in the direction of the second whipsaw, but not today. So, we just hung up my trading shoes and called it a day. As another rule, What Is FX rarely open new trades after 11-11:30 am as things begin to slow down after that. Today would have been a good exception as we climbed 50 pips after 1:30PM.
For tonight we have some volatility pointing to weakness showing up in the euro which is rather uncharacteristic for this time of day. We will get some reports over night of eurozone PMI for both services and manufacturing. Should they point to continuing slowing in the zone, which is what Bernanke warned about in his testimony today, we should see more down ward pressure materialize on the euro. Italian and Spanish bonds have been on the rise today, and if that continues it will also exert more downside pressure. We will also get US Jobless Claims tomorrow and Leading Indicators. We’ll see how we trade around them and structure our day. US Equities were down on the big board today, but the S&P was only off a touch still holding above 1,400. Nearly every indicator is flashing overbought at this point. The question remains, if the S&P falls, which currency will be coupled to it…the euro or the usd?
We have currently fallen below the hourly pivot at 1.3236, and are now hanging around the daily pivot (remember they are recalculated at 5PM EST each day) at 1.3224. Should we drop below where we are now, that would also put us below the rising trend line that dated back to 11:30am this morning. Additional support is at 1.3200, 1.3165, then 1.3120. Nearside resistance is at 1.3250. The head and shoulders pattern is still on the table on the daily chart.
What Is FX Daily Directions
The following paragraphs have been omitted by the editor as they contain proprietary trading information that is reserved for our subscribers. Please visit The FX Trading Masters for your 90 day trial.
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Happy Trading!
Bill
traderwillie8782@yahoo.com
facebook.com/TheFXTradingMasters
What Is FX March Results: +385.0 pips
What Is FX Year-To-Date Results: +1,733.0 pips
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