FT has been trading full time from home for two years, with nothing but four kids and a beach to distract him .
He fills his spare time with weight training and rugby, though more coaching than playing these days.
FT mostly trades the forex markets and although he plays FTSE on occasions his bread and butter market is £$.
He likes to think that his technique is evolving but still hasn’t the temperament or money to back the big calls. He prefers to trade between 1 and 3 times a day, aiming to take regular small gains, but feels part of the evolution is in not dealing if the conditions don’t feel right.
Hell Hath No Fury…
So, we wave goodbye to the entertaining Tongan rugby team, complete with inside centre Paddy Power but minus their green hair.
Hell hath no fury like a broken resistance line.
Regular readers won’t have failed to notice me droning on about how effective the downtrend line in GBP/USD has been; I’ve based quite a few winning trades on the assumption that the price would struggle to break through the trend line and I reckon I wasn’t alone in that.
Such was the Dollar weakness last Friday that GBP/USD broke above the downtrend line convincingly, triggering stop losses and forcing traders to re-assess the new trading range. Once resistance at $2.0265(ish) broke, the currency shot up a further 200-pips in a one-way market.
Have a look at where the next resistance line appears. It’s at about $2.0465 (ish), the previous high in early August. Yeah, OK GBP/USD has been above that briefly, but the test is whether it remains above that level.
For the record I sold £4 of GBP/USD at $2.0469 this morning. I put my stop loss at $2.0495, just above the day’s high. As I’m trading against the bigger (upward) trend I’m being pretty cautious and have so far closed £3 off for a gain of £60. I’m running £1 with my stop down to just below break-even at $2.0467.
Briefly, another breakout worth a look at is USD/JPY, only in this case the Yen is weakening. The possible explanation here is that if confidence is returning to the market, traders will return to putting on the carry trade (For an explanation on carry trades have a read of FX and Interest Rates Or A Tuna Sandwich).
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