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.
Payrolls Payback
Huh, yesterday I wrote an article (Roll Up, Roll Up, For the Payrolls Roulette) explaining some of the vagaries of the US Payroll data; however, I didn’t highlight just how irrationally the markets react to the figures. I should have known better, but I fell victim to a quick trade which deprived me of some weekend pocket-money.
There’s no getting away from it, the payroll numbers weren’t good. The conflicting reports from the two main surveys (Payroll numbers and Unemployment Rate) that I warned about in my article were absent. Revisions to the previous two months were both downward, giving a total loss of 232,000 jobs in the first quarter. The Unemployment Rate rose to 5.1%.
Understandably, the Dollar weakened immediately; the GBPUSD rate rushed ahead to $2.0050, but I wasn’t tempted to chase it. Recently sharp reactions to news have seen fairly immediate setbacks to test the mood so I watched and waited.
The price returned to the $2.0020 level and seemed pretty comfortable there. I pitched in and paid $2.0022 for £10 worth, placing my stop just below the big figure at $1.9985. In honesty, I got what I deserved. I’ve made some good money trading economic numbers recently, but it’s high risk, especially on a Friday with traders squaring positions ahead of the weekend. And even more so after Non-Farm Payrolls. I used to have a self-imposed dealing ban on Payrolls day; perhaps I ought to re-instate it.
Credit where it’s due, some-one planned an excellent ambush on the market. Suck a load of traders in, then use the higher price to whack the currency in the opposite direction. A succession of stops added momentum to the movement leaving one or two very happy bunnies.
Check out the chart, the price tanked off. I was stopped out in minutes for a loss of £370. I’ve had a good week on the forex side, it was just a careless way to give some of it back. Even after years of trading we still need the odd kick up the arse.
Equities are still behaving far too well; this week has seen a continuing worsening of economic data, Beardy Ben Bernanke conceding that the US might well go into recession and members of the US Fed playing down expectations of further cuts in rates. And yet the FTSE looks set to close up 300 points on the week. There’ve been none of the panicky sell-offs that typified the past three months, and there looks to be good buying on any weakness.
If you fancy a safer bet Paddy Power’s offering 3-1 on snow falling at Aintree during racing tomorrow.
Have a Good Weekend
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