- Re-entered short EUR/USD at 1.2679 mid-week, together with short Copper at 349 and S&P at 1321.
- Added on to the short EUR/USD at 1.2511 on Friday's NY close.
- Weekly EUR/USD chart looks horrible. SHS top formation (symmetrical double humped shoulders). Warning : The most obvious ones are the most dangerous ones too in terms of potential to suck in fools. For now, would not like to see this above 1.2623 on a weekly closing basis.
- P&L pretty much where it was before I left off, at about 50% loss recovery from the abyss. Still a lot of ground to make up but some cause for optimism.
- Was absolutely correct to have squared off 70% of Risk Off positions the week before. Last week's roller-coaster with gold all the way back up to 1600 would have played havoc with my emotions and triggered actions which I would have regretted. Re-entry at worst levels than where one took profits is a cheap price to pay for the preservation of emotional capital.
- The gold (triangle) sell-off is disappointing so I have switched half of that risk to shorting EUR/USD instead. In hindsight, the Copper/Gold switch was a very costly one in terms of opportunity profits given up.
- RIP Robin Gibb. So sad. The first pop song I ever liked in my life = Massachusetts. (1967, I was 5).
4 comments:
Welcome back TS! The EUR short is such an obvious trade that there is real risk of a short squeeze and a shakeout. But if the H&S is indeed validated, there is a long way to the downside target (1.09 by my measuring). Gold is also a short as per the charts, but you are right, there are violent reversals in gold, so emotionally more taxing to trade it.
I've re-vamped my blog, still keeping it simple: www.zenfxtrader.wordpress.com
All the best!
Pandu
Thanks. EUR/USD @ 1.2590 now. Looks like well and truly suckered here again.
TS, the short EURUSD will work out, although the entry may not be the best. I find one old trader's saying very useful for entries after breaks or breakouts: "A dog always comes back to smell its vomit". It describes the break and re-test behaviour of markets with typical down-to-earth trading pit humor. That's what is happening now. At a minimum it will test 1.2625 which was a major support earlier. But a weekly close below the strong trendline is a very strong signal. So patience!
All the best. Pandu
Oh I am quite comfortable with it. No worries mate.
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