Trading update 6/26

Opened a long position a little while ago. Legged in putting just under half the position on at -20% divergence then completed the position at -.32%, or 1.5261. The pair just broke down past yesterday's low of 1.5257 which could open up a move all the way down to the 1.5200 level. That was an area of consolidation on Wednesday between the big morning and afternoon moves. A solid break of 1.5200 could push the pair back down to the 200 day moving average at roughly 1.5150, which could be a very important area of resistance because both the 200 day and 200 hour moving averages converge there.
All of that is nice to know but it doesn't affect the way I trade on a daily basis. The next long entry for me would be under 1.5210 which could be a stretch for today. This current downward move could be more correlated to the USDCHF being close to session lows, after all the EURCHF necessarily has to be close to if not exactly the result of the EURUSD multiplied by the USDCHF.

Zero Sum Game

I was having a conversation with a friend last night who was very curious why I get up around 3am on weekdays. I explained that I trade the forex market and he said quite succinctly that I am a professional gambler. That comment made me chuckle and he went on to ask what the difference was between me sitting at a computer looking at charts trying to pick when to trade and playing online poker. This got me thinking and we went on to discuss how this is a zero sum game just like poker. The money I made yesterday trading came from someone, at my level it came from my broker. They take the opposite side of every trade I enter so if I win they lose and so on. When the dollar amounts get bigger the only thing that changes is who takes the other side of the trade. As a capitalist this idea that in order for me to win someone somewhere has to lose doesn't bother me a bit. We each put our best foot forward and today I came out on top.

Slow morning

The pair is trading in a tight range this morning of around 30 pips top to bottom. I am all cash right now, waiting for a solid entry opportunity. There is nothing wrong with going into the weekend without any trades on as some crazy things can happen in just a couple days, like Lehman Brothers going belly-up and the government telling us we were on the brink of disaster.

Trading update

Closed my short position at 1.5260 which happened to be pretty much the low for the day so far. Looks like the USDCHF action has slowed as its down qutie a bit from the days high. I'm not trading the spread right now, but I feel it is important to keep track of the EURUSD and USDCHF because a significant move in either can drag or push the EURCHF along.

More madness

EURCHF went up 100+ pips in three minutes, again. Rumors about "official" or "semi-official" buying were flying around, but I don't think they hold any water. An intervention at this rate would have to be pretty big and get much better results to be worth the effort since we're only 30 pips above the start of the move now. Unfortunately I don't have an alternate hypothesis for the big move, at least not a good one. My best guess is that a big player took on a position and it took the pair right through a bunch of stops people had right above 1.5320. I was looking for a buy just before the big move but my trading platform mysteriously closed so I didn't get in. However, picked up a partial short position about half-way up the move that as of this writing is in the green.

Good call yesterday

Deciding to sit the rest of the day out was a good call. The first thought after a significant move, at least for many traders, is to catch the "inevitable" retracement which would have meant going short. However, I bet very few people expected the SNB or someone else to start purchasing the USDCHF in large quantities which drove up the EURCHF in kind. This was especially surprising because of the time, very late in the European session. All of the previous large moves have taken place much earlier in the day.

Good morning SNB

Today I closed all of my long trades during the large run up starting at 6:44am EST. The intervention by the SNB or one of their proxies took the EURCHF 100 pips past my target so I was able to book some solid profits today. As of now I am all cash waiting, most likely, until tomorrow morning to initiate any trades. With the Fed statement still looming this afternoon and such a strong move this morning it is prudent to wait for some stabilization before reentering the market.

Slow start to the week

I opened another long position last night shortly after trading opened, primarily because of the gap down from the Friday close. Assuming that the gap would close overnight was correct as it only took 10 hours for it to retrace the full amount. However, I kept the position open because I still hold a strong bias on the long side at these levels. Also, my entry is almost -.25% from my nearest position so it fits within my trading plan.
The beginning of this week could be quite slow with traders waiting for the Federal Reserve to finish their meeting and release their statement and the Fed Funds rate at 2:15pm EST on Wednesday.

Still Trading

No posts but quite a few trades recently. Moved to trading full time and really enjoy it. The SNB came out yesterday and reiterated their concern for an appreciating currency against the Euro, which was expected but still good to hear since I was holding 3 long positions. After 8am EST the big move up finally came and I closed the 3rd position for profit. I have been trading full term for the past 3 weeks, all of which have been profitable and I'm holding 2 positions going into the weekend.