24 Feb This Week’s Swing Trading Round Up; 24th February 2013
This is yet another Week where I have to begin by apologising for the lack of updates!
In last Weekends review I suggested the likelihood for retraces in Yen pairs, and they did retrace. I suggested Euro pairs may pull back from resistance, and they did. I also proposed the possibility of a pull back across Indices, predominantly in the form of a high volume single day flush, and we had that too, albeit not in the 2% region as I’d hoped.
Despite all that, I didn’t enter a single swing trade! This was due to work commitments that happened to keep me away from the trading desk through all of the important turning points and once these retrace moves begin from new highs it’s often too risky to enter the trades because the risk of selling short at the bottom of a retrace within an uptrend is too high. Until Indices and various FX pairs confirm lower highs the main Daily trends remain intact.
Until that lower high confirms itself, we are still in Buy The Dip territory which in itself is difficult to comprehend when we can clearly see rotation taking place across some stocks and various other unconfirmed signs that a short to medium term Market top might be in progress. I’m not saying the market has topped, we could easily go higher, but I don’t think we are far away from a correction. The volume associated with the selling throughout last Week definitely indicates a willingness of market participants to start taking profits.
There were a couple of GBP related set-ups I had my eye on, but Friday night’s downgrade of British Sovereign Debt put paid to those ideas with most GBP pairs now looking grossly oversold. This news may even be a positive turning point for GBP as it was expected and should have already been priced in.
I remain interested in shorting CHF, particularly through re-entry of the USD:CHF swing long that I closed out a couple of Weeks ago. In fact I’ve already opened a USD:CHF long but am treating it as a day trade for now with a view to taking profits sometime in tomorrows session (or a loss!).
I’m quite looking forward to spending a little more time on the markets this coming Week so hopefully I’ll find something of interest to trade, because so far the lack of trades taken this Year has made the profit over the last 2 Months look minuscule compared to this time last Year. That said, day trading has been very profitable this Year so far, although 2 notably bad days have hit profits more than I’d have liked.
In the meantime, I’ll try and keep my eyes open this Week with a view to finding some decent swing trades to get these pips rolling in!