Wednesday, July 31, 2013

Yen continues to strengthen

Yen continues to grind upwards at the expense of Aussie dollar.

Currency Strength Meter:

Tuesday, July 30, 2013

Morning DAX trade

DAX opened bang in the middle of range (small gap up from yesterday's close), so I expected balanced trading. Initial direction was upwards, and there were some short-term topping signals (RSI over-bought, longer wicks on candle tops, sideways direction). However, I know that London open will often cause a sharp move on the DAX, and I really wasn't sure if it would move up or down at this point.

When London opened, it moved down initially, back to the open. I nearly took a long trade here, but decided against it, although it would have worked out. Then price moved higher and broke the previous day's high. More topping signals, and I tried to go short here with an entry order, but price moved away from me too quickly without any re-test. Price broke through the open and I finally got short on a pull-back to the IBL & open, targeting the session low. This was just a scalp trade.

I'm expecting fairly balanced trading this morning. When US opens things might change.

I'm experimenting with "RSI High-Lighter" today, so I'm not being too aggressive on the trading side.

RSI Over-bought / Over-sold

I'm experimenting with a new indicator. I wanted to add RSI to my chart, but found I was running out of room (price is the main thing for me, I don't want to spend too much chart space on indicators). So, I borrowed an idea I'd seen elsewhere to show the over-bought / over-sold as a high-lighted area on the price chart. This is just a prototype, but it looks quite useful so far.

This chart uses the indicator, with RSI period of 10, and over-bought / over-sold at 70/30 respectively. Over-bought bars are high-lighted green. Over-sold bars are high-lighted purple.

In theory, other oscillators like Stochastics or CCI could be used. The high-light could also be replaced by a "paint bar" option or option to print a special marker character above/below the bar.

This is currently a work-in-progress.

Nikkei regains some of recent losses, AUD slumps

Currency Strength Meter:

Monday, July 29, 2013

Trading et Market Profile

This French website has a lot of resources and information for Market Profile trading. Much of it is in French. They also have a trading room and private forum which is subscription-only.

Applied Volume Spread Analysis in Short Term Trading

FTSE morning trade

Well, Monday morning and Nikkei is down another 2% overnight, and Yen continues to remain high. I expected bearish start to the European stocks.

FTSE opened up in middle of prior day's range, and then shot up quickly to Friday's (rejected) IBL (Initial Balance Low). There was evidence of rejection here again, and I wanted to short here, but was a little too eager with my first entry which was stopped out, a 2nd entry was made at Friday IBL, and this worked. I targeted Friday's close, scaled out 1 lot, and kept another lot on for further decline, but didn't get any follow-through, so closed this also. A nice start to the week.

Friday, July 26, 2013

Equities continue to slide, as does gold and silver

The liquidation in Japan driving Yen higher, is having knock-on effect throughout the markets. Just about everything down (except Yen). Dollar on slight rise now also.

Japanese Yen Gains as Liquidation Hits Asian Stock Exchanges

Japanese Yen Gains as Liquidation Hits Asian Stock Exchanges (article from DailyFX)

DAX and FTSE morning trades

Yesterday was a frustrating day for me, I just couldn't get the timing right, and either missed opportunities, or scratched trades because they were too slow, only see them work out 2 bars later. Ended yesterday a little over break-even.

Today, was much better start. DAX opened in the middle of range, and started trading higher, I expected a test of previous day's high and had entry orders there. When FTSE opened, jumped up to the previous day's high, broke through and then traded back down quite aggressively. Having seen the rejection at the top of the opening range, I was looking for short entry, I didn't get sufficient pull-back, so I went with sell stop order just under the opening range low. DAX followed the FTSE, so I had the same trade there too. Both trades were targeting the previous day's session close, and both were successful.

Wednesday, July 24, 2013

Morning DAX trade

Well, DAX opened in range, right near the previous day's session close, and near the low. I entered long. Unfortunately, something came up at home that I had to attend to, so I could not manage the trade and so I scratched it at break-even. Another fine entry presented itself, but I missed it also. The break-out occurred on good PMI data, and I only managed to scalp a little on the long tail. A frustrating start to the day.

Gold Composite Profile

The Composite Profile shows the volume at price. High Value Nodes (HVNs) and Low Value Nodes (LVNs) can act as magnets, support and resistance.

Tuesday, July 23, 2013

Zig-Zag Released

Back from vacation this week, so I had a chance to finish off a few final details on the Zig-Zag indicator, and produce the documentation, etc.

The Zig-Zag indicator will segment the price action into distinct up-moves and down-moves. The direction of each zig-zag is determined according to the amount of price retracement of the closing prices. Unlike most normal zig-zag indicators, this indicator also generates a histogram which can display addition information according to the display mode. The mode can be Volume, Pips or Time. When the Volume mode is used, this Zig-Zag indicator is basically equivalent to the Weis Wave (invented by David Weis for his Wyckoffian trading method).

More details can be found here.

Morning gap trade on the FTSE100

Back from vacation now, and back into day-trading DAX and FTSE using Session Lines, Market Profile and Zig-Zag indicators. FTSE100 opened with a gap-up above the previous day's high, but I saw no really strong reason for this (Globex S&P500 made a weak high on the overnight, but it was not much and will certainly trade lower today).

I faded the move. Unfortunately, I was stopped out on a quick spike move up, and lost the first trade, but I re-entered at the better price, and targeted the previous day's mid. It actually went a little further, down to the previous day's session close which also closes the gap, but very happy with the trade.

Monday, July 15, 2013

Vacation Time

I'm on vacation, and didn't get chance to make any posts in a while. Back to normal next week.

Friday, July 5, 2013


DAX traded down during the morning, coming to rest around the relatively neutral zone of yesterday's mid price. NFP caused huge spike back into the opening range (yesterday's close) and then back down again, all within 15mins. Spreads and risk are too high for me to trade. I expect we will see further market reaction once US opens.

GBP takes another tumble overnight

GBP sees further losses overnight. FTSE maintains at its recent highs.

Thursday, July 4, 2013

BoE rate unchanged, GBP slumps across the board

First rate decision meeting from new BoE chairman Mark Carney. The rate is unchanged, as is the asset purchase facility. The effect on GBP was significant, losing across the board, and the FTSE100 rose 50 pips also.

ECB rate also stays the same. Both BoE and ECB offering some form of "forward guidance" which seems to have really made the stock markets rally. US markets closed today of course for 4th July. And its NFP data tomorrow too - so looking like an interesting day!

Wednesday, July 3, 2013

Surge in oil, and political crisis in Portugal

A surge in oil over last couple of days and political crisis in Portugal, have lead to sharply lower equities in Europe today.

The Multi-Compare indicator allows several instruments to be easily compared at once, showing the relative gains/loss as a %. The Currency Strength Meter computes the relative strengths of 8 base currencies, from analysing 28 currency pairs.

Tuesday, July 2, 2013

Smart Trading Apps

This blogger has developed some cool apps for FXCM's Trading Station / MarketScope. He's got several types of apps, which can provide automatic stop loss and multi-level profit targets, including global risk management across all open positions.

Monday, July 1, 2013

The Money Masters (documentary)

This is an old documentary (3.5 hours long) discussing the history of central banking, debt, the money masters and the creation of the US Federal Reserve Bank. From 1996, but still interesting and relevant.

Currency Strength Meter Release 8

I've just completed the package for Release 8 of the Currency Strength Meter. This release implements a "Lite" mode which only computes the currency strengths for USD, EUR, GBP, JPY and AUD. As such, it only requires 10 currency pairs. The "Full" mode uses 28 currency pairs.