Last week I read Z’s blog on trailing stop losses with a knowing grin. I tend to use a trailing stop loss, but a bit too enthusiastically and it happened again this morning. I think these crazy markets are messing with my sleep patterns coz I was down with my screens on by 5.45 this morning, and no, that’s not normal. By 7 o’clock I’d cruised through my various charts, read the papers on e-mail and dealt.

The overnight theme seemed to be further strengthening of the US Dollar. The commodity currencies, Canada, Australia, New Zealand, had all continued to weaken and £$ was sniffing around the $2.04 level. An attempt to rally Sterling had failed so when £$ broke below the $2.04 level I decided to sell. I was lucky to get $2.0402 on a small bounce and didn’t place a stop loss immediately as I was hoping for a quick trade. Within minutes I’d bought back £6 of my trade at 2.0389, so I placed my stop on the remaining £2 at break even. I usually do this as I like to leave the trade with my gains protected, but it follows a predictable pattern- more times than not a loose price or a small retracement will take out my stop.

And Bingo! That’s what happened this morning, just before Sterling fell a further 40 pips. Still, that was a £78 profit before 8 o’clock. When I grow up I want to have the balls of a stallion, then I might leave a wider stop loss and make more money!

Major excitement today should be the 1.30 release of US GDP figures for the second quarter. I’d be more interested in a weak figure to see whether the Dollar would sell off on that, or whether the markets ignore that and trade the recent downtrend. But before that I might sneak in a quick gym session this morning.

Happy Trading