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  • #501
  • May 1, 2018 10:35am May 1, 2018 10:35am
I traded the GDP live for CAD via EUR/CAD today and was 20 pips in profit at one point then the trade went 40 pips against me because PMI came out bad for CAD.

Now CAD was also losing strength because WTI Crude was taking a beating. It missed my stop loss by like 5 pips also (Credit myself on the well placed stop).

Now why didn't I close the trade when I saw it go against me? I knew the EUR was taking a beating due to lack of demand for it (I'm currently 75 pips up on eur/usd short ) and I knew GDP was good for CAD, but ultimately I knew at this moment in time that CAD was more in demand than the EURO hence why I knew it would come back down and I closed it at break even (Not holding as I am wrapping up for the day and this Iran news could destroy the trade if positive for Oil)

Not only can you make money from fundamentals, but you can also save money from cutting losses because you know the overall fundamental picture will at some point, put your trade in the fundamental direction.

If you have watched the movie the Big short you will remember all those guys were in draw-down when they best against the housing market, but they held their trades because they understood the Fundamental
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  • #502
  • May 1, 2018 10:54am May 1, 2018 10:54am
Quoting Samson85
So today I have gone short EUR/USD. This is based on dollar pressure and the market quite uncertain about how the ECB is going to operate. It seems alot of funds are also releasing their gains as the EUR was quite hyper extended via the 1 day chart. It's an interesting one eur/USD. Barclays are targeting 1.1739 for eur/USD to reach. <<< I mentioned this yesterday but I will drill the analyst at ransquawk to see if this is really achievable. I am still in the cable short hoping PMI will come out bad due to last months weather. I am still long INR/USD....
Eur/USD swing going good so far. 70 pips + up

What could really effect this trade is the FOMC minutes tomorrow and some EUR data. Only the FOMC minutes could have significant effect on whether the trade gets cut or not.
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  • #503
  • May 1, 2018 4:00pm May 1, 2018 4:00pm

  1. Despite the expected low volatility due to some public holidays, the markets appeared to be very lively!


I was in the green overall however if I was more selective with my trading pairs this would have led to efficient position sizing which would have amounted to more profits, here are my trades for today:

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The main mistakes made was not getting a price at a point of control which for me is at a moving average or at fair value using Market Profile, here is an example from today:

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The red price was my first entry which I later abandoned, for a better entry although it was only a few pips)

FUNDAMENTAL ANALYSIS (UK)

My bias for the start of the UK session was a bullish CAD, due to :

  1. The positive expected data release
  2. geopolitical tensions concerning Oil supply
  3. Yesterday CAD data releases (minor, medium and major) were consistently positive compared to the USD which had a few inconsistencies


However, the USD was very overpowering (due to the rate hikes expected) and was something I could not ignore, which led me to change currency pairs mid-session, in order to get around this next time I will trade fewer pairs (2-3 max) simultaneously

I started off:

Bullish: CADCHF, CADJPY
Bearish: AUDCAD

Then changed too:

Bullish: USDJPY, CADJPY
Bearish: GBPCAD, GBPUSD

Other fundamental reasonings for my bearish bias:

  1. AUD - Rates unchanged with nothing expected till 2019 so no reason to buy
  2. GBP - Brexit woes
  3. EUR - Stimulus input unchanged, despite talks of reducing QE
  4. CHF - Gold was down and CHF has been overvalued for some time
  5. JPY - Ambitious inflation targets have been talked down by the BOJ

As you can see at the time, too much analysis ultimately led to inefficiency (thankfully not paralysis)

US

Going into the US session I narrowed down my choice of pairs to only 4; I maintained my stance on a bullish USD and CAD, and a bearish AUD and GBP for the same reasons as above, however, I was not sure if a breakdown in NAFTA negotiations was hindering the success bullish the CAD deserved in the markets, I was thinking of dropping the currency but I stayed true to my fundamentals!

Bearish: AUDUSD, AUDCAD, GBPUSD, GBPCAD


SUMMARY

Hopefully, this will add value to anyone reading this hoping of approaching the markets from a fundamental aspect, there were a lot of mistakes made today.

Key takeaways for me will be to:

  1. Trade only a few pairs at the same time
  2. Use of fair value models (i.e. looking at the price of Oil may have made me switch to trading just the USD bullish going into the US session)
  3. Pay attention to psychological levels - This would have indicated how strong the USD was, the USDJPY and EURUSD broke many psychological barriers

To Pipccess and Beyond
  • #504
  • Edited 7:58pm May 1, 2018 7:29pm | Edited 7:58pm
Hmmm looks like a rate cut could be coming. Nick Bovell (Jarratt's top student now hedge fund manager) said he sees the rbnz cutting rates.

Going to trade a pair into the rbnz interest rate release which is next week.

Hmmm now that article says pound could fall to 1.32 by the close of year but I think it could fall to 1.32 by next week Thursday as we have the BOE interest rate release. Bloomberg articles are very powerful but they never put the correct anticipated timing of a currency hitting a target as they don't want to be accused of seducing the market. When I posted my 1st big pound short a few weeks back (on the thread) I said there were 2 articles of option traders betting pound would see 1.40 by month end. Now it did see 1.40 two days after the release of the article bang on a Fridays close lol and we still had plenty of time in the month. The only thing that could hinder this trade is Fomc today and NFP on Friday.
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  • #505
  • May 2, 2018 1:08am May 2, 2018 1:08am
Quoting Samson85
The only thing that could hinder this trade is Fomc today and NFP on Friday. {image} {image}
It does seem the GBP is heading south! Even yesterday all data for the GBP was consistently below (or at expectations), I was going to pair it as my bearish base currency but there is some news out at 9.30 which is expected to be above expectation which may give an excuse for contrarians to push the price the opposite direction, so I choose its close correlated pair the EUR instead

I will be pairing this with the EURAUD for the following reasons:

 

  1. AUD: CNY positive growth data and the AUD beat data expectations in the commodities index, this will be sufficient enough for the EUR to hold its own against the EUR

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I wanted to go also pair the CAD with the EUR but due to finding out that Netanyahu's breaking news story was already known by Atomic Energy Agencies (some officials) and the anti-effect of a strong dollar on WTI and no resolution to talks about NAFTA, I felt it best to leave this out till further information is supplied
To Pipccess and Beyond
  • #506
  • May 2, 2018 1:21am May 2, 2018 1:21am
Morning all,

So today I have re-entered Cable with the view of it going to 1.32 by next week Thursday (BOE meeting). What I expect to happen next week thursday is for the BOE to be very Hawkish then cable rally for quite sometime, but until now I am focused on selling cable. Bare in mind we have FOMC minutes today which could change the overall picture.

The overall fundamental is the same but there is pound selling this morning. GBP/AUD has also broke its support line on the 1 day chart which looks a great sell.
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  • #507
  • May 2, 2018 1:27am May 2, 2018 1:27am
Quoting forexin101
{quote} It does seem the GBP is heading south! Even yesterday all data for the GBP was consistently below (or at expectations), I was going to pair it as my bearish base currency but there is some news out at 9.30 which is expected to be above expectation which may give an excuse for contrarians to push the price the opposite direction, so I choose its close correlated pair the EUR instead I will be pairing this with the EURAUD for the following reasons: AUD: CNY positive growth data and the AUD beat data expectations in the commoditiejs index,...
AUD looks a bid today due to positive china PMI and also copper rebounded today.

GBP/AUD could tank quite bad today.

If the PMI is positive today for uk it will be semi muted I feel, but if negative it will cause a bit of a stir. I do expect it to be negative due to weather as Construction is outdoor work.

I may buy AUD VS JPY or hopefully find another weak pair
  • #508
  • May 2, 2018 1:33am May 2, 2018 1:33am
HSBC are targeting cable to 1.3150
  • #509
  • Edited 2:00am May 2, 2018 1:45am | Edited 2:00am
I am also long AUD/JPY although I bought at the highs.

Reason for the trade is a strong bid on copper and positive china Pmi

I am also long eur/sek. I traded the interest rate release last week but I shoukd have only taken half profits and let it rally because since then the pair has really moved. We just had negative pmi for sek as well I will be targeting r1 for profit.
  • #510
  • May 2, 2018 2:30am May 2, 2018 2:30am
I've also added EURNZD short as a nice way to diversify my risk, although the employment data was at a record low, wages have not improved however the markets are very sensitive to change and I believe they will focus on the change as a driver to push prices further against the EUR
To Pipccess and Beyond
  • #511
  • May 2, 2018 4:13am May 2, 2018 4:13am
Quoting forexin101
I've also added EURNZD short as a nice way to diversify my risk, although the employment data was at a record low, wages have not improved however the markets are very sensitive to change and I believe they will focus on the change as a driver to push prices further against the EUR
Be careful with that as it is also dollar taking a breather but EUR is also weak, some times you get late reactions and soon NZD will take a beating.
  • #512
  • May 2, 2018 4:19am May 2, 2018 4:19am
Quoting Samson85
I am also long AUD/JPY although I bought at the highs. Reason for the trade is a strong bid on copper and positive china Pmi I am also long eur/sek. I traded the interest rate release last week but I shoukd have only taken half profits and let it rally because since then the pair has really moved. We just had negative pmi for sek as well I will be targeting r1 for profit.
Morning Samson 85 I thank You for this thread as I am starting to believe fundamental trading most probably is the right way to trade the problem is being able to understand and interpreting news the right way and that it is not easy and it will take a lot of time for a beginner. So it is not good for me participating in any comments so just watching at the moment hope it will be OK with You
  • #513
  • May 2, 2018 4:36am May 2, 2018 4:36am
Quoting Samson85
{quote} Be careful with that as it is also dollar taking a breather but EUR is also weak, sometimes you get late reactions and soon NZD will take a beating.
My belief behind these trades is that once profit-taking stops taking place in the USD, it is true that the EUR, NZD/AUD will take a beating but I believe this will occur in the EUR more than the AUD/NZD for two reasons:

 

  1. The EUR is more liquid than the AUD/NZD
  2. The EUR and AUD/NZD, although going in different directions fundamentally, the EUR has a stronger fundamental bias

UPDATE

 

  1. At the moment the both of my trades are reversing in profits but I am going to have this down due to a decrease in volume and I expect the trend to continue once the volume resumes
  2. I took a reactionary trade on the GBP announcement going GBPUSD long, not much in terms of pips but with higher volumes such trades may be useful in the future for quick profits

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To Pipccess and Beyond
  • #514
  • May 2, 2018 4:38am May 2, 2018 4:38am
Quoting ralfy
{quote} Morning Samson 85 I thank You for this thread as I am starting to believe fundamental trading most probably is the right way to trade the problem is being able to understand and interpreting news the right way and that it is not easy and it will take a lot of time for a beginner. So it is not good for me participating in any comments so just watching at the moment hope it will be OK with You
Hi,

Please watch these videos and they will give you a better perception.

https://youtu.be/80eJbVhxWlI

https://youtu.be/SsQBjHK-SH4

If you need any help after just reply your thoughts.

Thanks.
  • #515
  • May 2, 2018 5:34am May 2, 2018 5:34am
Quoting Samson85
{quote} AUD looks a bid today due to positive china PMI and also copper rebounded today. GBP/AUD could tank quite bad today. If the PMI is positive today for uk it will be semi muted I feel, but if negative it will cause a bit of a stir. I do expect it to be negative due to weather as Construction is outdoor work. I may buy AUD VS JPY or hopefully find another weak pair

Closed the AUD/JPY trade as it seems to be mirroring AUD/USD, but EUR/SEK cancelled out the losses which is currently 20 pips up and I have R1 set as the target

Copper and tech seems to have boosted DAX, but it seems that the market was happy for a little run up on AUD and take profit which is a shame on me. I did not catch the best entry as I bought at the highs hoping for penetration, but yet again trading too many pairs is limits time for set ups.
  • #516
  • May 2, 2018 7:50am May 2, 2018 7:50am
Quoting forexin101
{quote} UPDATE At the moment the both of my trades are reversing in profits but I am going to have this down due to a decrease in volume {image}
There is a good technical setup now presenting itself on the 5 min for both the EURAUD and the EURNZD, but I am now having mixed biases towards the direction of the currencies on a sentimental and a fundamental basis due to the tension built around the FOMC announcement today, for this reason, I took breakeven trades/small profits on both trades, and will trade mainly the news announcements today until a clearer picture can be built around the USD
To Pipccess and Beyond
  • #517
  • May 2, 2018 8:37am May 2, 2018 8:37am
Quoting forexin101
{quote} There is a good technical setup now presenting itself on the 5 min for both the EURAUD and the EURNZD, but I am now having mixed biases towards the direction of the currencies on a sentimental and a fundamental basis due to the tension built around the FOMC announcement today, for this reason, I took breakeven trades/small profits on both trades, and will trade mainly the news announcements today until a clearer picture can be built around the USD
I did the same on EUR/SEK & AUD/JPY small profit combined.

It seems the market is ignoring the fundamnetal rules and focusing on FOMC.

The dollar index is now picking up
  • #518
  • May 2, 2018 9:04am May 2, 2018 9:04am
Drawdown - I was once again in drawdown, but due to knowing the fundamental I held even though I was in a 50 pip loss. The key is that when a fundamnetal is strong, best to ignore the noise and embrace the red for it will soon turn to green. my cable short from this morning is in profit and eur/usd currently over 100 pips profit.

I have also attached the break even trades from this morning that being eur/sek and aud/jpy. Eur/sek has since rallied into my proposed profit target
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  • #519
  • May 2, 2018 9:21am May 2, 2018 9:21am
Quoting Samson85
I was once again in drawdown, but due to knowing the fundamental I held even though I was in a 50 pip loss. The key is that when a fundamental is strong, best to ignore the noise and embrace the red for it will soon turn to green.
Congrats to holding on! This is truly a testament to the power of the fundamentals, I will analyse and post a more detailed reason as to why I came out of my EUR/NZD and EUR/AUD trade (which would now be in the green) later, but it all stemmed from the doubts I had in the EUR being able to bring the AUD and NZD down due to the FOMC, and because the EUR is relatively an anti-dollar currency I felt at the time gauging the direction of the USD would be important for my psyche going into these trades so I can add as a confirmation bias to my fundamentals, but since I did not have that I felt it safe to pull out

I could also go with a bullish NZD/JPY as I still believe in the NZD (and AUD but not so much now), but then again the JPY's direct relationship with the USD is a concern for me again due to the FOMC.

It is times like this where I need to remind myself the reasons as to why I'm trading a go with the overall fundamental bias and if it fades away pullout until it reappears
To Pipccess and Beyond
  • #520
  • May 2, 2018 9:52am May 2, 2018 9:52am
Quoting forexin101
{quote} Congrats to holding on! This is truly a testament to the power of the fundamentals, I will analyse and post a more detailed reason as to why I came out of my EUR/NZD and EUR/AUD trade (which would now be in the green) later, but it all stemmed from the doubts I had in the EUR being able to bring the AUD and NZD down due to the FOMC, and because the EUR is relatively an anti-dollar currency I felt at the time gauging the direction of the USD would be important for my psyche going into these trades so I can add as a confirmation bias to my...
There was technicals involved as pound rejected the daily pivot 5 times which was also in line with the 38.2% fibanachi level

Annoying EUR/AUD & EUR/NZD are tanking!!
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