The sands of time blow through another week in the wonderful world of Forex trading
Another week ends with headlines being the main driver. The Chequers cheers turned to jeers at the start of the week and it nearly turned to tears for Theresa May who perhaps came precariously close to losing her job.
The dollar finishes the week on the back foot on the day;
But on the front foot for the week.
Aside from the three at the top, the majosr all lost out vs USD.
The pound and euro had a busy week but unlike USDJPY they haven’t broken new ground. For all the headlines out this week, the stability in these pairs is quite something. Has it been the football, has it been the summer lull? I thinks it’s been a bit of both. Even the move up into 112.00 in USDJPY hasn’t really powered on. This pair has done next to nothing for the last few weeks so this looks to be nothing more than just shifting to a new plane or range. We’ll talk business if we get a push towards 114.00.
I still get the feeling that what we’re also seeing is an allocation shift between pairs. Players are shifting money here and there for yield or safety and while it’s moving currencies around with it, it’s all sort of zero-summing in the bigger picture, hence why we’re not seeing any real breaks. I also feel that once we get into August and folks start coming back from their jollies, we’ll see volumes pick up and we’ll get the types of moves we saw a couple of weeks into the new year.
Trading wise, I’m not pushing the envelope on trades while markets are listless. Until I see some real trends developing, I’m happy to job small amounts off the levels I feel are the most strongest. That requires some patience and a tighter grip of discipline because it’s hard to do nothing sometimes. But, that’s the way I trade. I don’t get desperate to trade because I haven’t done something for a day or two. There’s nothing wrong with taking a back seat while these conditions rule but I do worry when I see people trying to get a trade out of something every single minute, hour, day.
There will always be opportunities in these markets but sometimes you have to fit your style to your conditions. If you’re a longer-term trader then there’s no need to go chasing scalps because there’s no trends. They will come eventually so why get out your comfort zone just to try and trade? Keep your powder dry, even if it means having a lean month, because you can pick up the trades when volumes and volatility return.
I did four trades this week. A loser in cable on Monday, a winner in EURUSD on Tuesday, and then small winners in USDCAD and USDJPY Wednesday and today. Nothing fancy, nothing life changing but trades, levels and scenarios I planned and traded. I would have been happy doing none and that mentality has also been reflected this week by my colleagues. There’s not many of us who are chasing trades or getting desperate to trade. We know the trades will come to us eventually.
But, it’s horses for courses always so I hope that however you trade, it’s been a good and profitable week for you. Now it’s time to switch off and enjoy the weekend, so I bid you fair well at the end of this week and I look forward to seeing you next week.
Thank you for coming to ForexFLow.
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