Thursday, April 14, 2011
MARKET UPDATE 1
One of the best ways to know if operators have targeted a position for attack is to watch for relative strength.
For example, if you are in a Eurusd trade, look at all of the Usd pairs. When a position has been targeted for attack the Eurusd ( or whatever pair ) is very active with ticks moving up and down rapidly between a small range or sometimes a large range. Now, when you look at the other Usd pairs, the pairs are hardly moving.
You know, drip, drip, squeezing out pips. Well, think about it. If the markets are corrolated, and they certainly are, how can one be raising hell and the other asleep? Do you see this discrepancy? whenever you see moves that are not natural beware and watch that position along with the other pairs of that currency.
I mean, if a currency is strong across the board but there is one laggard we need to look at our Mfi indicator and see what the Professionals are doing and where the retail herd is located. For example:
I signaled a buy Gbpusd to my trade alert group. Of course, as typically happens after I signal a trade Gbpusd get's real active. However, when I looked at the other Gbp pairs it's was not moving much at all. So I moved the stops out of target range. What's target range? Within the range of the prior swing...Outside of the swing is a potential trend change and they don't want that to go against them you can believe that!!
So, when I determine a position is in the cross hairs I may play games with the stops. Many traders tickle the hell out of me treating stops as if they are law. Listen, stops are like poker chips. You only let the world see the fake out sometimes and sometimes you treat the stop like it is the law. You don't want to set a pattern for the broker bots to hone in on. Why do you think they call retail traders, "PATTERN DAY TRADERS"? Because their trade decisions day to day form a predictable pattern the the professional program trading bots can zero in on to chase your stops. You gotta think what can be done with the most sophisticated computer software on the planet and who can afford it?
but anyway, this was just a little note to help my trade alert group to understand a little about why I make certain decisions because I often get the question, "Jerry, is that how you always do it? Of course not!!! Does the market always do the same thing the same way? That's like asking a basketball player if he/she always makes the same moves the same way?
There are principles, and within the principles there are options one can take which maintain the principle or go against the principle. First you must learn, and not just know the principle. Too many traders either want a robot or think they can trade robotically and that is the key. It's not...
MARKET UPDATE 1
Hello
Click the link to see closed trade list for this week. CLOSED TRADES WED APRIL 13 2011
The real action for today will start around 8:30 am est. U.S. payroll data is scheduled to be released. The kicker is that there is a G-7 conference that begins today.
The G-7 is the group of 7 most influential economies in the world. They get together to decide which way they will take the markets and who's currency needs to go up or down to balance out the world currencies over all.
This is when fat cats really have a field day with retail traders. Of course the insiders know what's going to happen because they make the policy. Someone always knows. See the classic Eddie Murphy movie, "Trading Places", and you will get an idea how it works for real.
Employment and trade data are the two most market moving reports besides the big one, which is interest rate reports. Combine the U.S. data with G-7 and we could be in for a wild ride. There are plenty of false setups during these meeting so be smart. Control your emotions.
I will continue to call trades on twitter even though I am loathe to do so during these times because I hate uncertainty in the markets. Uncertainty means the professionals have their way with two way moves to take out stops and just stampede the herd one way and then surprise with a big fast move against retailers before they have time to react.
I will probably wait until after the data is announced before I make any moves but don't hold me to that. If I see a setup to good to overlook I may just make the call.
I know that some of you signed up for the trade alerts over the last week and I have not been able to get you situated yet due to the nasty computer virus I was telling you about last week. Also, remember that I make trade calls through Twitter. If you want the trade alerts and I send you a Twitter invite you should answer if you want trade alerts.
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