How can you get up from your screens, grab a workout or run errands or worse yet….go to bed?!
It is simple – but let me ask you a question first.
Why can’t you get up from your screens?
The answer I most often hear is as follows:
I need to make sure I protect my profits
I was looking at some trading blogs and I saw another viewpoint
My trading style demands me to watch the price action very closely
Allow me to respectfully dispel these ideas:
Protect your profits – this is nothing more than I was up 50 ticks on this trade, now I am only up 23 – I need to get out. Who says the trend has changed – rarely does a trade go linear, it ebbs and flows.
Trading blogs – why do you need to get an opinion on your trade AFTER it has been placed – do you not trust your thesis?
Unless you are scalping 1-minute charts, staring at your screens adds no value – each tick against you actually triggers your brain to start thinking about what can go wrong – it plays on you and gets you to abandon your reason for getting into the trade.
These answers relegate the trader to be a prisoner of their screens, as it clearly indicates that the trader is not operating from a robust trading plan or as I call it – a framework.
If you do not have a framework you are compelled to manage and watch every change in prices thinking that that somehow puts you in control.
Nobody can control the market – you are kidding yourself!
Having a framework accomplishes the following:
Increases your confidence in placing and staying with trades
Provides an objective rule based approach
Allows for freedom – get away from the screens – do other activities that actually get your brain ready to come back later refreshed and recharged
Enhances your ability to stick with trends and capture the big dollars.
Do what every professional trader that trades for a living does - get yourself a framework.
USD/JPY catching a nice bid here in early Asian trading. It now looks like Wave 4 is complete (forecast on 5/23). Clients looking to get long should use 100.65 as a suggested stop-loss with 103.72+ a level that should accelerate the buying.
Got an email from long-time client Dmitri in California - it goes as follows:
Hi Dave,
Maybe a naive question, but if EUR/USD is going down, why are we long EUR/SEK?
Thanks,
Dmitri
Dmitri - not a naive question at all - logic would suggest that something does not add up if we are bullish one but bearish another. However, take a quick look at the video below - it should address your question.
OK Traders, Aspen Team Member Jason Johnson has put together Episode #2 of his 'Journey of An Aspiring Trader' video series - this week he re-caps a trade in the 10-year notes.
Hi, my name is Dave Floyd, Founder and Head of Research and Trading here at Aspen Trading. First, thanks so much for signing up for this report, I am confident you will find it a valuable read. In putting this together it brought back so many memories, lessons and success stories that the words just flowed.
It is my sincere hope that this document will either assist you in turning around your up to now failed attempt at trading consistently or teach a few new tricks to improve upon what already works for you.
Ready? Great, then let’s get started.
I first got the trading bug back in 1992 when talking with a co-worker at Scudder Stevens & Clark – the Boston based investment firm. He said, if you are interested in trading you should read The Market Wizards books. I had never heard of them – I grabbed both editions at The Coop in Harvard Square on the way home. Within 2-3 days both books were consumed and I was hooked. Thus began my quest to become a trader.
It happened about a year later – I was hired by Standard Chartered Bank at the San Francisco office on their FX and fixed income desk. Download Full Report
Last weeks soft close by the S&P's (1629) was certainly out the norm - I mean equities only go higher with 'The Bearded One' at the helm - right? Kidding aside, the move lower off the May 22nd highs is likely just part of a long overdue correction. It is certainly possible prices could move lower towards 1604 (minimum downside target if wave count is correct) while a move back above 1637 creates overlap and gives the bulls reason for hope.
I could do all sorts of further scenario analysis, but the fact is, the S&P's are not as key recently for FX markets as is the Dollar Index (DXC). This index is not only a bit cleaner in terms of the price structure/wave count but is far better correlated with the likes of EUR/USD, AUD/USD and NZD/USD.
DXC: broke down off the May 22nd highs and while some minimum Fibonacci support levels have contained the drop, the action off the May 30th lows is not convincing me just yet that a low is in place. Additionally, some of the momentum studies (triggered May 30th) I also rely on are suggesting the bears have control for the time being.
EUR/USD: the rally off the May 22nd lows is not impulsive and last week's break above 1.2997 suggests momentum/directional change could be in the works.
USD/JPY: benefit of the doubt goes to the bulls unless the 99.87 level gives way. For now I am neutral on this pair.
AUD/USD: the downtrend remains intact, no reason to look for picking a bottom at this stage. However, looking for shorts in and around current levels is not advised either.
AUD/NZD: this is the FX cross I find most interesting presently. It has been a solid downtrend since mid-March, yet on May 31, price action triggered some fresh upside momentum that may have legs. Additionally, the move above 1.2030 gives further ammo to the bulls.
EUR/NOK: last, but certainly not least, our orders to get long in EUR/NOK at 7.6435 remain in place and if EUR/USD can begin to make a move higher early in the week - this cross could catch a nice bid higher.
As always, there will be some twists and turns - but that is trading, but if you lack a plan you know the odds of making money are greatly reduced.
Gold bulls have been humbled in recent weeks/months. Nonetheless, the move off the June 27th low gives reason for optimism. A solid 5-wave move higher was a rare sighting in recent months.
Nonetheless, prices are now correcting lower in Wave (ii) - however, prices need to hold this support level at 1223/12. If they do, a break back above 1258 should put prices on a path towards 1357
Aspenalysis: Simple To Follow FX Trade Ideas
