Traderdesk journal

[TraderDesk]

June 24 2013:

New week and temperature here is above 36c, perfect beach weather.

Looking at GBP/JPY I will set some buys once again looking for a reversal on the bearish bias. I am looking for at least 151.5 and 152 IF bullish price movement occurs.

[TraderDesk]

June 25 2013:

Yesterday I was looking for at least 151.5 which happen late last night. Today I am bias for a high of 151.8 - 152 with a look at 150 or 149.20-30 low so I will play those positions accordingly...

[TraderDesk]

June 26 2013:

Today I am looking at the long-term trend which means weekly chart. This currency pair has been in a uptrend and will continue to have this bias as long as 141 level holds. What I see on the chart is ranging bars so putting limits and stops at both ends would be one way to play it.

Now I am drilling down to the daily chart to see where I could put these limits/stops. First place today is a buy limit at 149.70 level. This is an obvious area as price has bounced from here several times. Next place is at 149.45 where price movement has open and close multiple times. Last place I would look at is 148.73 level which is close to the above reason as well as near a old trend line that price movement gyrated at.

Now here is the kicker, price movement is below the daily HA line which should have me place sell limit orders instead of buys. That goes against a policy of my trading strategy so why do I do it? Well I still feel that the JPY is still too expensive and that a explosive price movement going above the daily HA line is a strong possibility.

Since I am trading against the daily bias I have to be careful to take my profits where I can and get out if price goes strongly the wrong way.

It is a human fallacy at the retail trading level to think you know the market to a point where you don't listen to price movement. I have and will probably fall for this in the future but I will take steps to mitigate the loss of capital when this happens.

Let the trading for the day begin...

[TraderDesk]

June 27 2013:

Still in Greece on vacation

As I am seeing in my trading, my positions are contrary to the daily market flow. So to put this into an analogy, I am swimming against the current for the moment.

The good news is I am still making profit albeit a much smaller one than what I could be making if I was bias bearish as the daily chart indicates.

Today I will continue to be bullish but with the usual caveats of caution as express in the previous days.

I have buy limits placed at 149.3 level as well as at 148.7. Let's see if I can at least average out of any drawdown and regroup.

[TraderDesk]

I decided to go with the daily chart bias which is bearish. I closed out my last remain buy limit position for a very small profit and have open a sell market order as well as placed sell limit orders at 150.8 and 151.4 levels. Let's see if I can work this out...

[kwanann]

Actually based on what i see, GBP is weakening, so the chances of GBPYEN going up is rather low..

just my5c,,

[TraderDesk]

Actually based on what i see, GBP is weakening, so the chances of GBPYEN going up is rather low..

just my5c,,

At the moment I see the same on my charts. That is why I changed my bias for today from "bull to bear" and took some bear profit. CSS is showing both currencies weakening with GBP leading JPY in losing strength.

The natural setup for me is now to sell into any rallies until daily HA line is broached to the upside.

My concern is that the weekly chart is still very bullish so I must watch out for rally formation on the daily chart. When the daily starts to show a reversal to the upside price movement can be very rapid for a few days and I want to take full advantage by having buy limits/stops.

For now though I must grind my way with bear positions...

As a trader I should not favor bias but the weekly chart has always affected me in the direction I want to trade in so when daily goes against weekly chart I have a habit of over thinking..

[kwanann]

Yup weekly still looks bullish, but the daily has been quite neutral for quite a few days, with a slight bias towards bear.

Yesterday was the first show-hand where shorts won. I'm expecting this to continue today and tomorrow (3 day cycle) perhaps going thru to monday. With a daily range of 200pips should be quite short work to get to 147 which is where i expect it to retrace to before a reversal.

Coincidentally, based on your prior analysis this should happen around this period that yen weakening begins.

[TraderDesk]

July 1 2013:

Good morning, start of a new week and a new month.

As usual I will talk about GBP/JPY. Since I am still in Greece on vacation I don't have my programs or time to show you visually what I am thinking but I did copy a few charts.

Let's start with the cross GBP/JPY. I look at two currency pairs that directly influence GBP/JPY which happen to be GBP/USD and USD/JPY. So let's look at a daily chart of both currency pairs.

First I bring up is USD/JPY in the daily time-frame. As you can see price movement is above the Heiken Ashi line which is a bullish bias. On the STO the level is reaching OB but it can stay that way for quite a while. I just have to keep an eye out for price exhaustion. Now what does this tell me? Well it tells me that buying of USD/JPY especially on pullbacks is quite possible. Which in turn gives a boost to price movement to GBP/JPY in bullish terms.

usdjpy.gdaily.png

Now we look at GBP/USD daily chart. What I see is this currency pair has dropped quite a bit and is in OS territory. Also you can see there is a bullish channel where price is near the lower end of the channel which gives the possibility of a strong support area. So the focus now is on whether this currency pair will bounce north from the area it is now at. Just one more observation on the chart is I see a bit of a candle tail at the low that show me possible lack of sellers. Now this tells me a possible reversal is a good possibility in the next few days. How much I don't know.

gbpusd.gdaily.png

Now if either of these two currency pairs or even both go north then I can see GBP/JPY breaking to the bullish side of the daily HA line.

Now let's look at the daily GBP/JPY chart. I see price movement is now very close to the HA line. For illustration purposes I have included a 60 LMWA to the chart. See how well it follows the HA Smoothed indicator.

gbpjpy.gdaily.png

Now I want to start to put together a bigger picture of what could happen this week with GBP/JPY. First thing I surmise is price movement has a good shot of breaking the daily HA line/60LMWA which could start the resumption of the daily bullish trend. Now if that is the case then I will start looking to place buy limits once again. If it does not sustain price above the line I will keep opening sell limits. Now where and how much etc... I will determine when I see the volatility in the pair.

This is just a snapshot on how I start to analyse currencies that will effect my trading operations.

[bernard]

Michael,
Looks like you have tamed the Beast. Good Job!!