19th Dec 2013 - IS AUDUSD poised for a minor correction?

Early this morning we saw the FOMC finally pulling out the "T" word - Tapering.

"The Federal Reserve announced Wednesday that it would reduce its USD85 billion-a-month bond buying program by USD10 billion in January. In his last press conference as Fed Chairman Ben Bernanke said the economy was continuing to make progress." (Source : http://www.investing.com/news/forex-news/forex---dollar-back-off-5-year-highs-vs.-yen-after-fed-taper-move-256952)

This move was not totally unexpected, as the FED had more or less toyed with the market for the better part of the past 6-8 months. The move resulted in a sudden surge in the strength of the USD, but the effect was rather mixed throughout the various major pairs. In this article, my focus is on the AUD.

Technically

- The major trend is in a downwards continuation

- The Trend within Trend is in a downwards continuation

- Major support has been broken, but price still hovering in support region

Fundamentally

- Market has taken over with at least one known general consensus, first step in tapering has started, which could mean that further cuts could also be in the coming. Although it has not happened yet, market will be in bullish USD sentiment for awhile

- Hot money still on the table ? FED has done a great job by setting the stage where it has convinced the market that "Tapering" & "Interest Rates Increase" are 2 separate matters, and can be dealt with separately.

- Worldwide stock markets rallied, indicating market stance of "risk on" mode, but perhaps more cautious at this time until the unavoidable OPTIMISM creeps in, and it will

- Given the above, my view is that FED has smartly conserved its ammo for the next round of market manipulation

How to Trade

Cracks appearing in AUD

Last week, I was surprised but not too surprised by ECB rate cut happening. I thought the possibility might come up, but not so soon. However, the fact that it did happen gave me reason to re-look at the markets and here are my latest views on how this will affect AUD, both technical and fundamental.

Technicals

- Price started easing off towards the break of the uptrend channel lower trendline, at at time when market was all about non-tapering

- Last RBA rate review, RBA rate statement did not provide the push downwards I was expecting, but sellers started showing themselves in the region indicated by the orange circle as shown, indicating the resistance of the retest line was still holding although price still wanted to break free

- 1st blue retest line support finally broken, something I had been waiting for

Fundamentals

-ECB rate cut has set the stage for other central banks apart from FED to start lowering interest rates to protect/boost their own country economy

- RBA rate statement was hawkish, indicating they are still open to having a much weaker currency. It created a huge red candle but not strong enough to break the then minor upwards trend within trend

- Although FED has not started to taper the QE, they have started to show signs in the last FOMC statement that they are slightly more optimistic about the future of the economy, by omitting some negative statements that in previous FOMC statements (Source : http://www.investing.com/news/forex-news/dollar-firms-up-vs.-rivals-after-fed-254553). The markets have clearly interpreted this as the FED looking to taper soon....If this happens, "Hot Money" will be retracted suddenly, and forcefully, and AUD will be one of the casualties

- RBA has maintained all the while that they think the AUD is still overvalued, this stance has not changed since before even the latest Australian Election

- Last week, from November 4th - 8th, datas coming out from Australia ie Retail Sales; Trade Balance, whose readings were better than expected, hardly rallied the AUDUSD, but a worse than previous reading of Employment Change caused the AUDUSD to erase earlier gains

- US has finally shown signs of putting into gear the start of Tapering, of which the inverse is what caused the AUDUSD to gap up in the first place, I believe the reason no longer existent which caused the rally of the AUDUSD

- Much better than forecast NFP data coming out crashed the AUDUSD, and will give reason to the FED to perhaps start their Tapering of QE soon

Conclusion

I believe the AUD USD will respect the latest downtrend Trend Within Trend, and there are plenty of fundamental reasons in favor of a cheaper AUDUSD, whilst technicals can speak for itself. I will be looking to sell the AUDUSD come Monday morning market open

UPDATED USDJPY TRADE 1ST NOV

Read below for the original trade idea!!!!!!!!

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The USDJPY has been stuck in a direction-searching movement for a good few weeks, and has long since come off the high established since late May 2013, as the steam provided by the actions of the BOJ, namely the stimulus in the form of bond buying has since lessened considerably. However, from May onwards until now the consequences of this action are still evident in the movements of this pair, especially whenever Japanese data points are released that indicate weakness in Japan's economy or whenever the BOJ's governor, Kuroda comes out to emphasise to the world that the institution is going to continue its large scale easing until its objectives are met.

However, the weakness in the USDJPY of late has largely been determined by the drama unfolding in the US and the focus on whether the FED will TAPER or NOT TAPER, and hence, the flight to safety came in often, and the short USDJPY risk off trade has been a source of profits for many in the market. Still, we can see from the charts that the strong uptrend previously created is still largely intact.

In recent developments, we can see that the USDJPY has since found a support level after systematically moving within a huge trend channel.

So how will I trade this pair? Let's take a look on a shorter term timeframe

As the UJ has convincingly broken out of this downtrend, I am of the view that it will continue upwards to the target I have identified above. Barring any changes in the fundamental factors, I will continue looking for good entry points to buy until that level. As Japan has stronly reiterated its stance on its monetary policy and objectives, I am comfortable being bullish on the USDJPY even if the FED does not taper its QE until early next year, and will be looking to go long even if the USDJPY falls to lower levels.

I have already started going long as I had taken a chance on the breakout happening based on observations of technical and fundamental factors.

* This article is a courtesy of www.traderence.com, under Traderence Holding Pte Ltd

Is NFP strong enough to provide direction for pairs?

As the trading day progressed today, we could witness largely indecision in the markets with regards to the USD and the general sentiment towards the health of the global economy on Monday.

Throughout the day, limited movements were experienced in most of the pairs, as it became more and more evident that the market was waiting to see where the US economy will be headed. Although the US government shutdown has since been ended, it is estimated that as much as hundreds of millions of dollars a day was lost with each day the government was shutdown.

This has put traders on the defensive in buying into the USD as the market may see this as a factor that could delay the tapering by the Federal Reserve(US Central Bank) of its monthly QE activities to the tune of 85 billion USD until it can see better data coming out in support of the economic recovery it is pushing so hard for. The market was expecting an October tapering, or perhaps even November, but the government shutdown has since changed the views of many, who think that it has hurt the economy and hence delayed the recovery.

With the exception of the USDJPY & GBPUSD, most of the major pairs showed little directional bias, although the EURUSD & USDCHF did provide some movement but still ended up largely unchanged.

The directional movement of the USDJPY was largely due to JPY weakness as it showed a worse than expected "Trade Balance" number and from statements made by the BOJ governor Kuroda who reiterated that the bank would stick to its stimulus program. (Source : http://www.investing.com/news/forex-news/dollar-moves-higher-vs.-yen,-u.s.-data-in-focus-254091). Even then, the price action shows signs of a shallow movement indicating caution by traders.

This would support my view that the NFP reading coming out from the US which was delayed due to the shutdown of government services, and originally scheduled to come out October 4th, and has now been rescheduled again to 22 October, is in the focus. Depending on how much it will deviate from the forecast, this could be the catalyst that could tip the currencies in either direction and provide some volatility in the markets. Coupled with some data coming out from China in the morning, I am certain Tuesday will be a much more eventful trading day and I will be ready to take advantage of the movements!

GBPUSD reversal coming in?

So, it seems that the minor downtrend being formed in the GBPUSD has been solidified and established? However, is this just a pullback before going even higher or is a reversal actually coming in? Let's take a look;

Much will depend on the stance of the BOE and its governor Mark Carney, and what the decision will be in terms of its monetary policy, ie whether the BOE is going to reduce, maintain, or increase interest rates and what their justification behind its move will be.

In fact, it was because Mr Carney did not increase interest rates which disappointed the GBP bulls, and prompted the strong upward movement to start easing off.

The fact that the US government is taking the first steps to bridge their disagreements between the Republicans and Democrats in terms of the debt ceiling and government spending is giving USD bulls some reason to celebrate and we can see it being reflected in most of the major pairs, ie USDJPY, EURUSD, and of course the GBPUSD. (Read : http://www.investing.com/news/forex-news/dollar-firms-up-on-u.s.-debt-ceiling-deal-hopes-253718)

Of course, the announcement by Barack Obama on the next person he is tapping to be the Federal Reserve chairperson has eased alot of uncertainty and also yesterday evening's FOMC meeting minutes have given the market the impression of tapering "ALMOST" being on the table.

Well, if you are also looking at the 7pm "Asset purchase facility" and "Rate Statement" reading, you might also want to take a minute to look at what Mark Carney and his team are thinking or looking at. (http://www.bloomberg.com/news/2013-10-09/carney-eyes-recovery-momentum-as-boe-seen-showing-united-front.html) 

I would personally read it as saying that the BOE is actually very cautious on its economic growth at the moment and that they will not increase interest rates with more allowance for further easing measures. This will be supported by the fact that recent data coming out of the UK is still shaky. (Industrial output & facorty production readings from yesterday)

I managed to get some profit from selling the GBP when it broke down of the second level of support, but maintaining caution as the market still seems uncertain on outcome from the US. However, for now, to follow the trend would be to continue selling.

UPDATED Trade; Latest on potential US govt shutdown threat; How should I play out this poker hand?

UPDATE of Trade position;

To find out the earlier part of the trade, read below:

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The latest developments in the political bickering between the Republicans and Democrats in the US is threatening to result in a government shutdown by September 30th, 2013, the end of the current fiscal year, which would mean that most of the services provided by the government will close down temporarily, barring some essential services ie, any federal program or agency which is tasked with protecting life & property, such as air traffic control and food inspection. (The latest on the political battle that caused this whole ruckus : http://edition.cnn.com/2013/09/20/politics/congress-spending-showdown/index.html). There is also the matter of raising the debt ceiling, which is also touched on in the article.

Apart from the obvious effects this would have on the US economy, such as uncertainty in the markets, which would hold off a lot of investment activity, which would eventually hit the jobs sector and consumer spending, there are many other negative effects which could spiral out of control.

"On the House floor on Friday, legislators warned of the serious consequences of a government shutdown. The last shutdown, which occurred during the Clinton administration more than 17 years ago, comprised a total of 28 days and cost the nation more than $1 billion, according to congressional researchers."

For more of the potential effects, read http://money.cnn.com/2013/09/23/news/economy/shutdown-economy/.

The effect of this matter on the financial markets is that traders have shown a tendency to discard the USD in favor of safe haven currencies, such as the JPY, as uncertainty dominates the markets.

Since last Thursday, I had a few short positions in the AUDUSD to take advantage of the realisation by traders that even with the weakness of the USD, the AUD is still overvalued, what more with the currency war on the table among all the major central banks of the world. Take a look at the chart below; my positions are indicated by the lines and the arrows

The previous rally in the AUDUSD was largely due to USD weakness because of the confusion in the run up to the announcement of the FOMC decision on the matter of taper or non taper of its current QE measures, however the latest developments in the US have thrown in new fundamental factors to consider in this position that I am holding.

Come Monday morning at the market open there could be a gap up in the AUDUSD, and I am considering whether I should fold on this hand; or should I be a little patient stay in the game, and wait for a chance to raise my stake in this round?

What do you think? Will this factor be a strong enough catalyst to reverse the AUDUSD latest minor sell off? The fact that this latest game of poker had extended itself to over the weekend, I am unable to do much but to come up with a plan to deal with the outcome come Monday morning market open.

FOMC announcement surprised me!!

So, there was no tapering announcement by the FOMC and they will continue their QE measures! Honestly, I was caught by surprise, but yet had also anticipated something going wrong unexpectedly (in the markets, it always happens), had a trading plan in mind and it worked!! Yes!

The pictures below are self explanatory; = )

A very interesting perspective from a fundamentalist standpoint

So, I am of the view that successful trading should consist of both technical and fundamentalist points of view. And no matter what alot of pure technicians out there might say, a trader once summed up this argument in a simple sentence; "It is fundamental developments that moves markets, it is not a line on a chart that moves the markets".

Meaning to say, that end of the day, it is fundamental reasons that form the core of supply and demand and the movements of money in and out of markets rather than just because of past data. Do technicals work? Yes, they do in my opinion, but being able to utilise fundamental information effectively is how alot of traders make BIG money.

However, trading with fundamental information is not easy, but it is also precisely because it is hard that the traders that know how to use it effectively can profit so much from it, and we're talking about millions and billions being made and put on the line because of fundamentals, not your measly few thousand bucks.

The following is a very interesting fundamentalist standpoint and one that takes into account going in depth into many, many factors but does not go too far and can come up with a realistic hypothesis.

Anyway, here it is;

Monday morning shocked lots of traders when there were huge gaps across all currencies; what exactly happened, and these are my views...

MY VIEWS ON MONDAY...LARRY SUMMERS SUDDEN WITHDRAWAL WAS A DECOY....

• Fed is running out of options; they need to price all major pairs before they announce the tapering in full scale
• Larry Summers withdrawal on Monday was very strategic; and all currencies took a ride to the north and now riding the way down
• Will FED Taper this week; the answer is absolutely YES!!
• The next focus is on the interest rates and this will make all FED bonds unlikeable...and sell off may take place... but the good news is this Monday event has already priced in everything

Look at the USD FUTURE CHARTS: Strategic to second support line Price and now is retracing back.....

What is my conclusion?

• Don't listen to those noises of Larry Summers or anything else; focus on the reality of the US, Europe, Australia, China situation....NOT GOOD AT ALL
• Listen to the Emerging Market Dilemma....BRIC - (BRAZIL, RUSSIA, INDIA & CHINA) - They will get hit the moment tapering starts...
• CRABS - (CANADA, RUSSIA, BRAZIL, AUSTRALIA & SOUTH AFRICA) - The commodities based countries are all in trouble if the Taper starts...

Well think again was Monday Announcement a Strategic move by FED & OBAMA administration...HAVE PRICED EVERYTHING before Thursday morning announcement...

USD WILL STRENGTHEN...and once again the downward spiral will start; but the effect has been absorbed...

The Oil speaks of it all..... with a strong co-relation with USD.....

Let's see what happens on Thursday morning at 2am Singapore time....

* Article courtesy of Traderence Holdings Pte Ltd

So what do you think of the of the fundamental analysis above? In my opinion, it is very good, it works to the extent that it gives the trader and idea to work with, and what to look out for. In more specific detail, how do you use this to your advantage? That is a lesson for another time.

EURUSD has officially resumed the most recent uptrend, but is it sustainable?

This morning saw gaps across the board for all major currencies as the USD crashed. Larry Summers, one of the candidates initially in the running to replace Fed Chairman Ben Bernanke's post, has officially pulled out of the race! Here's a copy of his letter to the president : http://online.wsj.com/public/resources/documents/summers.pdf

The gap up in the EURUSD officially resumed its uptrend after Friday night saw a heated tussle between the  bulls and bears, but is this uptrend sustainable? We know that of late, the USD has been one of the major influences on the currency market's movements throughout most pairs. However, let's see what will happen after 4pm local time.

Trading the Monday afternoon news...9/9/2013

The following is a post courtesy of Traderence Holdings Pte Ltd. (*Traderence Holdings Pte Ltd is an academy that is reputed across Asia & the Middle East, with branch offices in Malaysia, Singapore, Indonesia - Jakarta, Bali & Surabaya, Israel, and soon to be Phillipines and Japan, among other countries that are coming up. Source : www.traderence.com) 

1. 1.00pm – In the afternoon will give a clear picture of Japan consumer confidence – with Japanese winning the 2020 Summer Olympics yesterday – USD/JPY will have a another pullback lower and than the rise will never stop till next year June 2014
2. 1.45pm – will be the first aggressive move of the EUR & CHF when the unemployment rate results are announced – for sure is going to be weak and will drag EUR/USD down and USD/CHF upward
3. 3.15pm – Once again the CHF will move weaker as the currency have been too strong for business
4. 4.30pm – will conclude EUR with a clear direction to fight the downward momentum – will be a good start for trading
5. 8.30pm – Will be beginning of the USD & CAD – good to watch and trade with a clear direction

For more: “Think Fundamental & Trade Technical” is available at our member section…have fun trading and don’t try to be rich quickly,,,”Rome was not built overnight”

No information published constitutes a solicitation or offer, or recommendation, or advice, to buy or sell any investment instrument, to effect any transactions, or to conclude any legal act of any kind whatsoever. The information published and opinions expressed are provided by TRADERENCE for personal use and for informational purposes only and are subject to change without notice. TRADERENCE makes no representations (either expressed or implied) that the information and opinions expressed are accurate, complete or up to date. In particular, nothing contained constitutes financial, legal, tax or other advice, nor should any investment or any other decisions be made solely based on the content. You should obtain advice from a qualified expert before making any investment decision. All opinion is based upon sources that TRADERENCE believes to be reliable but they have no guarantees that this is the case. Therefore, whilst every effort is made to ensure that the content is accurate and complete, TRADERENCE makes no such claim.

Trading the Monday morning news 9/9/2013

The following is a post courtesy of Traderence Holdings Pte Ltd. (*Traderence Holdings Pte Ltd is an academy that is reputed across Asia & the Middle East, with branch offices in Malaysia, Singapore, Indonesia - Jakarta, Bali & Surabaya, Israel, and soon to be Phillipines and Japan, among other countries that are coming up. Source : www.traderence.com) 

1. 6.45am – NZD news as expected will be weaker than previous months – I will stay neutral for NZD/USD

2. 7.50am – there are going to be numerous news for Japan and all of them are very important ones – expect the JPY to break the 100 if the news are weak and expect the JPY to go back to its hole at 97.50 or lower – My expectation is above 100 this week – Syria War may drag JPY to 95 as a safe haven – a very tricky pair

3. 9.30am – will be the battle for AUSTRALIA & CHINA news – this good results will carry the AUD to new high as today’s trade news is excellent –  Keep an eye on these news and trade with excellent money management to handle to temporary upward drive… Saturday election results can also be a driver for upward drive for this pair….

No information published constitutes a solicitation or offer, or recommendation, or advice, to buy or sell any investment instrument, to effect any transactions, or to conclude any legal act of any kind whatsoever. The information published and opinions expressed are provided by TRADERENCE for personal use and for informational purposes only and are subject to change without notice. TRADERENCE makes no representations (either expressed or implied) that the information and opinions expressed are accurate, complete or up to date. In particular, nothing contained constitutes financial, legal, tax or other advice, nor should any investment or any other decisions be made solely based on the content. You should obtain advice from a qualified expert before making any investment decision. All opinion is based upon sources that TRADERENCE believes to be reliable but they have no guarantees that this is the case. Therefore, whilst every effort is made to ensure that the content is accurate and complete, TRADERENCE makes no such claim.

Australia has a new government...what will happen to the AUDUSD?

Australia is now officially under new management

"Tony Abbott is Australia’s 28th prime minister after a decisive swing to his Liberal National party Coalition – while Kevin Rudd has stood aside as Labor leader, taking solace in a party defeat that was not the rout widely predicted.

Tony Abbott claimed victory in front of ecstatic supporters at the Sydney Four Seasons hotel, declaring: “Australia is under new management and Australia is once again open for business.”

He promised his government would “be competent and trustworthy”, would “purposefully and steadfastly and methodically … set about delivering on our commitments” and would govern for everyone."

How will this news bode for the AUDUSD? My guess is that there is going to be a limited rally, if based on the news of the election alone, as the "feel good factor" could still be in play, however, based on the charts alone, it tells me that the AUDUSD could be facing still alot of sellers in the market.

BUT WAIT!!

The Chinese, not so unexpectedly, released their trade balance numbers on the following day after the Australian polls, which shows a better-than-expected reading than the forecast and a huge increase from the previous release. The news release was not announced beforehand but it is not unusual for the communist country to take the markets by surprise most of the time, and it normally happens on the weekends.

Based on my observations, I would be cautiously trading from the short side if it creates new highs, as again like I mentioned, the currency still faces significant resistance to the upside, and I would not be surprised that the sellers are just hoping that it will go higher so they can get a good price!

Let's take a look at some other traders views, courtesy of Traderence Holdings Pte Ltd. (*Traderence Holdings Pte Ltd is an academy that is reputed across Asia & the Middle East, with branch offices in Malaysia, Singapore, Indonesia - Jakarta, Bali & Surabaya, Israel, and soon to be Phillipines and Japan, among other countries that are coming up. Source : www.traderence.com) 

1. For Australia to get out of deficit – they must keep the currency low and competitive
2. They must execute Austerity and cut as much as possible in terms welfare
3. China must show significant demand for mining back again
4. Australia must drag their currency to 2% or lower to be back in the game with the rest of the world
5. I am very bearish for AUD till there is a significant signs of recovery

Here is my Chart for direction and understanding for AUSSIE DOLLAR

No information published constitutes a solicitation or offer, or recommendation, or advice, to buy or sell any investment instrument, to effect any transactions, or to conclude any legal act of any kind whatsoever. The information published and opinions expressed are provided by TRADERENCE for personal use and for informational purposes only and are subject to change without notice. TRADERENCE makes no representations (either expressed or implied) that the information and opinions expressed are accurate, complete or up to date. In particular, nothing contained constitutes financial, legal, tax or other advice, nor should any investment or any other decisions be made solely based on the content. You should obtain advice from a qualified expert before making any investment decision. All opinion is based upon sources that TRADERENCE believes to be reliable but they have no guarantees that this is the case. Therefore, whilst every effort is made to ensure that the content is accurate and complete, TRADERENCE makes no such claim.

6th Sept 2013 – TRADING THE NEWS…..

Good Day!! Traders and Apprentices

Today once again is going to be an important day for all traders around the world to decide for the whole month whether to buy or sell USD….

What are my expectations?

• 3.15pm – Will be Swiss CPI – which will start the volatility for EURO…..I am expecting a  weak CPI that will further weaken the Swiss against the USD –  BUY USD/CHF with FCS & FC
• 4.30pm – will be news from UK manufacturing data – which I am expecting a strong data as usual – after a series of good data’s released from UK the past months
• 8.00 – 8.30pm – the eyes of all traders will be on the US employment change that will rock the market – I am expecting a good result from US and that will lead US FED to start tapering soon in the next FOMC meeting..

My suggestions

1. Do not trade till the NFP
2. Trade with the trend and do not fight the trend
3. Stay focus on buying the USD and selling it when the data is good tonight

HEAD OF EDUCATION

*This post was derived from www.traderence.com

Disclaimer: Traderence Holdings Pte, Ltd. does not offer trading calls, trading models or portfolios that Subscribers should follow. Any trading model, trading call, or portfolios presented are Traderence Holdings Pte, Ltd. own opinions and are solely intended as educational information. Traderence Holdings Pte, Ltd. does not claim to have any special insight on the markets or on any security, nor does Traderence Holdings Pte, Ltd. claim that it is always correct in its opinions, trading calls, or securities selection. Traderence Holdings Pte, Ltd. will make mistakes and make bad trading calls. These are part of the education processes. Readers and or Subscriber need to make his/her own decisions as to what they should do with regard to their own trading and investing decisions.

Bid Price, Ask Price & Spreads

A friend of mine recently complain to me, saying that the Broker he used to trade is a crook, many times that when he is trading, he set his Take Profit (TP) and Stop Loss (SL) point and leave it there, he told me that a lot of times when the market price hit his TP point, the broker did not close his order in profit, while when the price is near to his SL point (1-2pips i supposed), the broker took his order out with a LOSS. He is very frustrated and complaining to me about his problems.

After digging further about his situation, i found out that he doesn't understand about the BID/ASK price and did not take into considerations of the SPREADS (Even though he had been trading for a while). So i decided to write a little bit about this topic, to remind myself to take into consideration of  BID/ASK PRICE, and SPREADS when trading.

                                BID PRICE                                                           ASK PRICE

BID PRICE
So, what is a bid price? A Bid price is a price that the market is willing to purchase at for a particular asset. Examples : the image aboved is a quote of Bid/Ask price of USD/CHF. the bid price is 0.93971, which means that if you made a Long trade, you would be paying the BID Price which is 0.93971 for this pair.

Another Example:

Lets say you put a Buy Limit @ 0.93900, you will only get your order filled when the price goes Xpips (spreads) below your order level, which is 0.93877 in this case. When the price reached 0.93877 (Bid Price), your order get filled and the price you get is 0.93900 (Ask Price).

                                BID PRICE                                                           ASK PRICE

ASK / OFFER PRICE
An Ask price is a price that the market is willing to sell for a particular asset. using the image aboved, if you close your order or Sell, you will be closing out at the Ask price which is 0.93994 for this pair.

Another Example:

If you put a Sell Limit lets say @ 0.94060, your order will however filled when the price reached Xpips (spreads) below your order level, which is 0.94037 in this case. When the price reached 0.94037 (Bid Price), your order get filled and the price you get is 0.94060 (Ask Price).

SPREADS
The spreads is the difference between the Bid and Ask price, for examples, the spreads for the USD/CHF aboved is 0.93994 - 0.93971 = 0.00023. which is 2.3 pips or 23 pipettes.

4th September News Trading

Good Day!! Traders & Apprentices

Here is the news today and what I am expectng?

1. Australia GDP = I am expecting a weak GDP and forcing the AUD back to its downward movement
2. Spanish and Italian SERVICES PMI & EURO Final PMI = I am neutral but EURO will continue on a downward movement as long as the tapering from US is on the table
3. EURO revised GDP q/q =  Will be weak and I am expecting further downward movement of EURO
4. CAD TRADE BALANCE =  is going to be weak after last week GDP results – expecting CAD to weaken further
5. USD TRADE BALANCE = Going to be interesting – as I am expecting the USD to strengthen further…
6. CAD RATE =  The day will end with BOC making decision to reduce or increase interest rate tonight….

Have fun and let’s start having fun in trading…..

HEAD OF EDUCATION

*This post was derived from www.traderence.com

Disclaimer: Traderence Holdings Pte, Ltd. does not offer trading calls, trading models or portfolios that Subscribers should follow. Any trading model, trading call, or portfolios presented are Traderence Holdings Pte, Ltd. own opinions and are solely intended as educational information. Traderence Holdings Pte, Ltd. does not claim to have any special insight on the markets or on any security, nor does Traderence Holdings Pte, Ltd. claim that it is always correct in its opinions, trading calls, or securities selection. Traderence Holdings Pte, Ltd. will make mistakes and make bad trading calls. These are part of the education processes. Readers and or Subscriber need to make his/her own decisions as to what they should do with regard to their own trading and investing decisions.

Brad Buffalo aka Trader Buffalo

30th August 2013 – News Trading and What can you expect today?

Good Day!! Traders and Apprentice

What happened yesterday?

Last week I was warning of the USD REBOUND and it has happened..and what can you expect this coming week and last night shocked everyone with an outstanding GDP results than made the USD rebound strongly..

This news last night made the USD strong…so what can you expect today?

• I am expecting the news in EURO to further be bad and will continue dragging the EURO lower
• Keep your eyes on German Retail sales and the Italian Unemployment Rate which I am expecting to be bad…

• CPI lower results going to drag the EURO lower and forcing the ECB to act on interest rate next month
• EURO unemployment is on focus today and any bad news will also drag the EURO down

• If you are trading the CAD keep your eye on GDP news as any good news you will have the CAD strengthen with a huge candle down…..
• Very interesting USD/CAD trade tonight….

• Friday will end with US consumer sentiment and FOMC Bullard views…
• Which I don’t see anything significant because of the anticipation of NFP next week and Tapering by the FED is on the table AND THIS WEEKEND AIR STRIKE BY NATO into SYRIA….
• USD is going to be a currency to keep an eye on….

NOTE: don’t be AGGRESSIVE today but rather conservative as we prepare for next week NFP – Non-Farm Payroll….

HEAD OF EDUCATION

*This post was derived from www.traderence.com

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The search for trading methods

The nature of humans being lazy, 

we tend to want to go for the easy way of doing things. And I don't think there is anything wrong with it, provided the easy way and the right way happen to be the same. Hence, providing the rationale for many would-be traders to keep searching for the Holy Grail - the one single method or formula that they can follow step by step to extract riches from the market. What many do not realise that the trading strategies are the simple thing, the hard thing is to keep themselves from straying away or constantly modifying what works; The following are some of the mistakes that many of us tend to make : - 

1. Not honoring stops or cut loss points, or constantly re-adjusting our stops to being outside of the original trading plan. This is one of the main mistakes that can cause otherwise profitable systems to becoming loss-making systems

2. Trading aggressively during draw downs with no respect for risk. Every strategy that has been conceived comes with losing trades. It is a part of the game. Understand that our focus should be on risk management first and foremost, without which there are NO consistent profits.

3. Lack of discipline, shifting from the initial trading plan of clearly defined entries and exit signals to personal opinions is detrimental, no matter how good you think your opinions have done in the past.

4. Not following money management rules and trading with too much risk. Many times, one does not realise this unless you are in a bad position.

5. Shifting from strategy to strategy in the middle of trades, or changing a short term trade to a long term trade or vice versa with no proper planning.

6. You have to have confidence in your method of trading. Confidence does not come from big words or the fact that you feel good. Confidence comes from doing homework and research.

7. Trying to get out of a bad loss with a single, big trade is almost always detrimental unless you have a proper plan of action to follow.