SPM

Well, here it is. My first trading journal on FF. I have been a member here since 2007, and followed various systems and threads along my journey.

I take a fundamental approach to form a bias from a global macro-economic perspective. Thus forming an idea of market sentiment, I will use this information combining technical analysis of levels to capitalise on currency moves.

I'm a purely discretionary manual trader from London UK. I combine technical analysis with fundamental analysis. I researches the core underlying elements that move a currency, zeroing in on the focus of the central banks trading risk events in line with the daily sentiment. I speculate on the interest rate differential between any two major currencies.


My thought process before placing a trade:

1. Which currency is moving?
2. In which direction the currency is being moved?
3. What has caused the current move in price?
4. What expectations do other traders/analysts have regarding the move?
5. Where are the technical levels for entries and exits?

Following these steps gives me a big picture, and vastly increases my chance of success compared to traders using just technicals. I generally looks for 50 pips per trade and i mitigate equity risk by using stops. News trading from the premium news flows (Ransquawk, Reuters Eikon, MNI) play a crucial part in my strategy, and i will scalp these events as and when they occur.

I often average back into a trade if is moves against me building my position in the market, and 1 use a maximum leverage of 3:1 on each trade.

My maximum drawdown on all open positions will not exceed 20% (Although it was 30% in the past) You can follow my trades through my trade explorer below.

Thanks

Steve

Reserved

This week I will be focusing on selling EURUSD, & GBPJPY from technical levels. Below are my fundamental reasons.

EUR: BEARISH. Eurozone final CPI for January missed estimates for the y/y at 0.3% vs expected 0.4%, however the m/m and core reading were both inline with expectations at -1.4% and 1% respectively. At the January 21 ECB meeting, Draghi made dovish comments, saying that monetary policy will be reviewed at the March meeting due to further deterioration in inflation expectations and other financial uncertainty.

USD: BULLISH. Core PCE for January ticked up to 1.7% y/y which is reassuring for the Fed's tightening policy. We may see some hawkish comments from Fed members in relation to the recent move higher in underlying inflation. The second reading of Q4 GDP beat estimates at 1.0% above 0.4% expected. The USD remains the strongest currency fundamentally. CPI for January beat estimates with Core CPI y/y ticking up to 2.2% and rising 0.3% for the month. Headline CPI was at 1.4% y/y. Minutes from the January meeting struck a cautious tone, noting increased uncertainty regarding inflation and potential financial risks. NFP for Jan saw 151,000 jobs added, versus expectations for 190,000. The unemployment rate fell to 4.9%. Average hourly earnings jumped 0.5% for the month, however the y/y figure held steady at 2.5%.

GBP: BEARISH. UK GDP second estimate for Q4 2015, came inline with expectations for both the q/q at 0.5% and the y/y at 1.9%. London Mayor Boris Johnson's announcement to campaign for leaving the EU has put extra bearish sentiment on sterling. Retail Sales beat estimates across the board with the m/m figure printing its highest value since December 2013. Average Earnings were at 1.9% for December, while the jobless rate moved up to 5.1%. Core CPI for January missed estimates and dipped back to 1.2%. The Bank of England vote split changed back to 9-0 with McCafferty no longer voting for a hike. Growth forecasts for 2016 and 2017 were downgraded while inflation is expected to remain below 1% til the end of the year. The referendum regarding Britain's exit from the EU contributes to bearish sentiment on the currency due to political uncertainty.

JPY: BEARISH. BOJ core CPI dropped to 1.1% y/y for January. GDP for Q4 2015 missed estimates at -0.4%. The Bank of Japan announced negative interest rates of -0.10% on January 29 but left the QQE program unchanged. The inflation target was pushed back to end 2017 and the Bank remains prepared to ease further if necessary. The BOJ are watching CPI excluding food & energy to gauge underlying inflation trend.

Hi Mackaozy, nice return for the year. Well done.

Thanks!! It was a lot better, however I had an awful month this month 28% loss. I got caught out with the EUR being bought as a funding currency.