June 10, 2011

Weekly Trading Update - 06-10 June 2011

It's been a fairly good week this week because my main 4 hour trading system (see right for more details) generated 2 winning trades out of 3. I also had some success trading early morning breakouts on the GBP/USD pair as well, so I cannot really complain. The only disappointment is that some of my shares have gone down in line with the wider market, but they're starting to bounce back now. Anyway let's talk about some of the forex trades for this week.

Starting with my main 4 hour system, I was particularly interested in the GBP/USD pair because the daily Supertrend had recently turned green, so I was looking for some upward EMA crossovers on the 4 hour chart.

This occurred on two occasions. The first time was on Tuesday and I went long at 1.6415 after a slight pull-back. The price continued rising and I managed to close half the position for 50 points, and moved my stop loss up to break-even. Unfortunately this stop loss was later taken out.

The second EMA crossover occurred yesterday but this one wasn't as successful. I went long at 1.6424 again after a slight pull-back, but this one never looked like coming good and I ended up taking a loss of 40 points.

The other trade was a perfect looking set-up on the FTSE 100. The EMAs were all sloping downwards but they briefly crossed upwards on Tuesday before crossing back downwards again, which is always a good sign. So I went short the following morning at 5845.

I wasn't looking for a huge move as the FTSE has been trading in a 5800-6100 range for quite a while now, so I decided to close the entire position at 5805 for a 40 point profit once it reached this point.

Elsewhere I placed two early morning breakout trades on the GBP/USD during the week, which both produced a profit.

The first was on Tuesday when the price broke upwards shortly after 8.00AM and looked like breaking through the pivot point. I was prepared to cut this trade early if the pivot acted as resistance but luckily it broke through and I banked 20 points. (If I had got up earlier I would have traded the 7.00AM breakout and closed at the pivot because this would have been a much stronger trade).

There was another breakout on Wednesday but the breakout candle was huge, so there was no trade there. However I managed to trade a second breakout on Thursday. The overnight range was tiny (around 20 points between 12.00 and 07.00) and again I would have traded the 7.00AM breakout if I had been at my computer because this would have been a great trading opportunity.

Nevertheless I still decided to trade the breakout that occurred shortly after 8.00AM because the overnight range was still fairly small, and went long at 1.6441. The R1 level was only around 10 points away, so I decided to hang on and hope to get 20 points, and thankfully it did reach this level in the end, although I was fairly lucky with this particular trade.

Those were all the trades I placed for this week. If you want to check out my main 4 hour trading strategy you can do so by filling in the opt-in form above. Otherwise have a great weekend.



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