June 28, 2008

Weekly Trading Update - June 23-27

It was another excellent trading week this week with 2 winning trades out of 2. One was a small winner and the other one was much larger.

The first trade, the small winning trade, was on the EUR/USD pair on Monday morning. I was looking for a downwards EMA crossover on the 4 hour chart, as per the daily trend, and it duly arrived so I went short on a pullback at 1.5530. The price then raced nicely downwards and I closed half my position at 1.5485, letting the other half run. Unfortunately this other half was subsequently stopped out at break-even.

There was a nice set-up on the USD/JPY pair on Monday evening, with the EMA crossing upwards nicely, but I didn't want to be holding an overnight position. As it turns out this would have been good for about 40 points if I'd gone ahead and entered a long position at 107.80, but not to worry.

My second trade was back on the EUR/USD again. I noticed after the failed downwards crossover it had risen slightly and consolidated nicely for around 24 hours between 12.00 on Tuesday and 12.00 on Wednesday. The 5,20,50 and 200 period EMA's were all flat and very close to each other, which is very often a precursor to a big breakout, so I was bracing myself for a big move one way or the other.

As it turned out it broke upwards late on on Wednesday and overnight, but thankfully I managed to catch the pullback first thing on Thursday morning. I went long at 1.5640 and despite being tempted to close half at 1.5700, I managed to hold on a bit longer, raised my stop up to 1.5700 when it broke through, which thankfully wasn't hit, and closed my entire position in the evening at 1.5763 for a very nice profit of around 120 points, after deducting the spread.

In addition to the forex trades I also traded the FTSE using a new short-term trading strategy I'm working on which yielded 7 winners out of 9, so all in all it was a very good week.

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