I'm somewhat late posting details of this trade as it was entered by an electronic limit order at a time where I had no internet connection to tweet it live, although details of the trade possibility were posted on the ADVFN forum in advance.
In short, here is what attracted me to this trade, entered at 1.4260:
Following overnight news that RBNZ have been selling NZD due to their belief its over-valued with a promise to continue intervention as necessary, I decided to take a closer look.
When trading this pair I find MACD very helpful. With regards to the long side, I would analyse as follows.
The Weekly candle is up against the 20 MA, quite a common retrace level in a Weekly trend. Also, my downside target of 1.71 hasn't been achieved yet so I'm not convinced a long term low is in place, but a medium term one could well be.
Despite spending most of the Week in bed with the Flu, a couple of set-ups did trigger entries whilst one of my most anticipated set-ups slipped me by.
As you'll know from previous posts, SPXhas achieved the top of the multi-year megaphone pattern. On its own a megaphone top pattern is not reliable, and there isn't anything else really supporting it (fundamentals aside of course), but in my efforts to be a hero I took the trade anyway entering short at 1596. On the basis that a pattern shown on the Monthly chart is likely to offer a multitude of opportunities for entries, I covered half the position 24 hours later for 14 points which isn't a bad profit for an SPX trade over such a short period and couldn't be ignored. The plan is to keep entering the trade at this perceived resistance, taking profits when they become available but leaving half the trade to run at all times until the set-up either pays off, or fails and proves the set-up wrong.
Not sure if I'm interested in trading this just yet but as EUR:USD bounced strongly from support I think its worth keeping an eye on to monitor if/when support is retested.
The situation is slightly complicated by the fact that I have Support in 2 different places depending on the time frame you look at, so I'll detail both scenarios before throwing a spanner in the works with a 3rd Scenario!
Due to other commitments outside of trading my attention has been predominantly elsewhere though I have tried to follow Market movements where possible.
Firstly, a brief outlook of Stock Markets based specifically around the DOW which may look like it's going to plunge, but I'm not sure about pre-empting that move for the following reasons:
USD:CHF has shown considerable weakness lately so I've been waiting for a suitable retrace to enter into the trend.
Although bearish in the main, USD:CHF is entering oversold territory on some time frames so the aim here is really to test the water with a view to covering the position on any sign of incorrect timing.
Having scanned through the charts tonight there's a number of charts at inflection points but nothing that I could deem as high probability, or at least high probability with minimal potential draw-down.
CAD JPY is one of the more interesting FX pairs but comes with a warning; Different time frames are showing potentially different outcomes, but I do think it's possible there's a short term trade coming up.
It would be fair to say that the last couple of Months have offered really tough conditions for swing trading, particularly because the day to day chop seen on many markets have made the line between overbought and oversold conditions quite difficult to define due to flat-lining indicators.