Gonçalo Moreira, CMT
Independent Analyst
- With the ECB in the rear view mirror one of the repercussions seen elsewhere is the Dow Jones trading slightly lower, the euro considerably higher and holding the rally, together an expression of unwinding of euro carry trade;
- Trend line studies on both charts (arithmetic scale) imply a change of price structure around the 15th December, which can take the form of a reversal or acceleration, coincidentally around the date when the Fed is expected to shake the markets;
- I could close all long orders which have been in the red for so long, at levels I personally was not expecting to see the market, but this is the beauty of trading without a market neutral approach.
- The short leg is the one in red now, but since the long-term trend is still bearish, I'll probably not close those positions while below 1.124 or so;
- The sell grid is crowded with limit orders at 1.1062, 1.1090, or 1.1287 to name a few;
- On the other side, longs can be found at current quote 1.0964 and slightly below at 1.0877 and 1.0813. The recent 1.0807 buy order was at a sweet confluence of 200 SMA on 4H-hr + weekly Pivot Point + round figure 1.0800, allowing me to buy at market for fun.
The trading methodology reported in this analysis is based on a non-directional approach. It is meant to capture the most amount of pips from the constant price oscillations, either up or down. Each trade has a take profit of 50 pips, a stop loss of 500 pips. The size of each trade is regular, but trades can be stacked around key support and resistance zones, increasing the overall position size around certain price zones. The system can perform either in trending or range bound markets, but it suffers when there is an extreme unidirectional price advance. Buy and sell positions are taken with two separate real accounts.
To learn more about the method, you can watch these special webinar series:
Exploring the Coast Line of Foreign Exchange Land - Part I
Exploring the Coast Line of Foreign Exchange Land - Part II
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