The U.S. Day Job Scalper

There's not much on tap for tomorrow: AUD Monetary Meeting Minutes ... , so the whole world's your scalping oyster (but I'll avoid AUD crosses for the evening ... .)

See you tomorrow ... .

Aussie Econ Scalp

So, we've got Aussie Monetary Policy Minutes in about an hour and half's time, so I thought I would have another go at trading news (last night didn't go spectacularly, although I made up for some of that with a fingertrap USD/JPY short ... .) Hey, what's a demo for but to try out new techniques ... . Quite frankly, I'm not very fond of watching the 5 min., waiting for that candle to close, and then entering. A good deal of the initial impulsive move has evaporated, and -- as we saw with Yen crosses last night, that move can quickly evaporate, leaving you feeling stupid and stopped out ... . Naturally, if there is follow-through in the direction of the original impulsive movement, that's all fine and dandy, but it doesn't always happen that way ... .

In any event, I thought I would try the Donchian Channel breakout method using the channels displayed on the AUD/USD 30 min. chart as guidelines for my entries:



Basically, I will set an order to go long should price break the top channel, as well as an order to go short should price break the lower. The SL's will be price at the level of the opposite channel, and the SL's will be moved to break even at the earliest possible opportunity and the pender that did not execute will be deleted. Some platforms allow you to place an OCO ("one cancels other") pair of orders for such a scenario, so that if the long executes, the short is deleted, and vice versa.

The way the channels are priced currently may naturally change in the next hour or so (it being a 30 min. chart), but right now the top channel is at about .8743 and the lower at .8692. So the plan is to fashion an entry order to go long if price strikes .8748 (5 pips north of the channel's upper limit) and to short if price strikes .8687 (5 pips south of the channel's lower limit).

Non-Econ Scalps

I've scrolled through obvious Asian session candidates for scalping, but am not particularly excited about any particular pair. Yen crosses appear to be digesting last night's monkey business, so I'm not sure I want to wade into those unless there is a repeat of last night's breakdown ... .

NZD/USD may be interesting, however, at least for purposes of a fingertrap scalp. The pair has broken through the 1H 8 and 34 SMA's and appears to be poised to head lower. However, I see some resistance below around .7900 and would prefer the pair to move through that level so that I could imaginably see some continuation through to .7840 or so ... . It has been sideways since around the London close. However, I've noticed some sympathetic movement in the Kiwi in response to Aussie data, so we'll have to see what occurs with the pair once the Aussie minutes are announced.

Also, I've been pouring over various charts in connection with what scalping method to use. I see practical drawbacks to the "1H Signal Candle" method described at the outset of this thread and that is, quite frankly, that I've got to wait an hour for a candle to close before setting up an entry order. Lots of good stuff can happen in an hour. For that reason, I'm going to focus on using fingertrap, even if it does yield fewer set-ups than the 1H Signal Candle method. Additionally, I don't want to necessarily settle for 10 pips as a matter of course. I want continuation that has the potential to yield more than 10; if I get ten because I moved my stop loss to break even + 10 pips, that's great, but if I can get more, I'm going to go for it in virtually every case.

On the other hand, EUR/JPY may be ripe for breakdown ... . It has had difficulty moving higher and retracing all of the ground it gave up post GDP figures. However, while price is below the 34 SMA on the 1H (just barely), it is still above it on the 5 min. Worth keeping an eye on, though, if it breaks through the 34 on the 5 min.

Pondering whether the 30 min. channel is too wide ... . Ceiling is + 40 above current price; floor - 20 or so.

The 15 min. Donchian channel ceiling is at .8722; floor -- .8695 (about the same as the 30 min.). That could also be a slight "tell" as to the direction traders think the announcement will push price ... .

Think I'm going to use the 15 min. channels ... .

25 minutes to the Aussie announcement ... . Going to place the opposing orders at the last minute in case things get "frisky" ... .

Sell order entry will be at .8692 (five pips below floor of channel), SL .8721 (channel ceiling).

Buy order entry .8726 (five pips above ceiling), SL .8697 (floor).

Lot size 2 x equity.

Looking like a schnooze, but NZD/USD breaking sympathetically higher ... .

Going with the buy side (not quite there yet), but deleting out the sell ... .

Keeping an eyeball on NZD/USD. Will consider a long if it breaks .7940 on a touch of the 8 SMA on the 5 min.

Lack of impulsive movement post-Monetary Minutes in AUD/USD (which is what I generally look for with econ announcements), so deleting out the entry for the econ news scalp. Worth keeping an eye on for just a straight fingertrap scalp, but would need to break resistance rather convincingly at .8721 for me to consider that.

Taking a break for a bit for din-din ... .

NZD/USD has broken above resistance at .7939 ... . Will consider fingertrap long at next touch of 5 min. 8 SMA ... .

AUD/USD still struggling to clear resistance at .8721.

Both AUD/USD and NZD/USD now collapsing a bit off resistance ... . Ugh. Looked promising ... .

Also keeping an eye on EUR/JPY potential for collapse ... .

With EUR/JPY, I'll need to see a cross of the 8 and 34 SMA ... .

Currently, arguable higher low on the 5 min., which doesn't bode well for a short currently ... .

NZD/USD and AUD/USD surrendering some gains from the Aussie news; neither clearing short-term resistance convincingly ... .

Out of the two, NZD/USD looks the more promising -- modest higher high on the 5 min.; could make another run for a higher high ... .

And now AUD/USD is back to pre-Monetary Minutes levels, and NZD/USD is retracing its sympathetic gains.

EUR/JPY may breakdown (eventually), but the temporary concern for a short here is the higher highs on the left. I know it's only a 5 min., so these are -- in the grand scheme of things -- minor blips on the radar ... :



I would prefer a series of lower lows and lower highs ... .

But the pair doesn't currently meet the criteria for a fingertrap short: (1) below the 34 SMA on the 1H; (2) below the 8 and 34 SMA on the 5 min.; (3) visibly trending in the direction of the trade .. .

An hour and 3/4's into the Tokyo, and nothing has panned out or looked promising (from a fingertrap perspective). Oh, well, there's always tomorrow ... .

Happy trading!

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