*A look at what I am trading this week and potential trade set ups*
Welcome back to the blog! I hope you all had a good weekend. I was rather busy last week and only managed to publish 2 blog posts, I apologise for this and will make up for it with 3 posts this week. In this blog post I will show you my current open trade positions and my plans for managing them through this week. I will finish up with a brief watchlist of potential trade setups that I see coming up.
My current open trade positions.
- FTSE100 Index – Short @ 6301.99
- Dow Jones Index (Spot) – Short @ $27,373
- GBPUSD FX Currency Pair – Short @ 1.25
I am bearish stocks as is most of the intelligent/non gambling side of the market. Stock market prices don’t align with current fundamentals or economics so I refuse to enter any meaningful long positions. This FTSE100 index short entry was a trendline break, trend continuation trade entering at a nice key level number (6300) which coincided with some strong price resistance forming. I believe this index will slowly works its way down to new 4hr lows around 5800/5750 which is where I plan to take most profits.
This Dow Jones short trade started life as a low timeframe, flag pattern intraday trade. However it was timed perfectly with a rather large sell off which saw prices drop around 10% from the highs and I therefore decided to keep open some portion of the short trade. Much like the FTSE100 trade and my overall beliefs, I think stocks will begin to contract and converge on the fundamental values of the stock market based on the state of the actual real world economy. Therefore, in my opinion, it is prudent to leave some short exposure open.
GBPUSD FX Currency Pair
This trade was a basic trend continuation set up which I covered in a blog post last week. I am still holding this trade because I believe that it will continue to fall through this week and go on to make new lower lows around 1.22500 or lower. You can see the full trade analysis by clicking on the link below.
Potential trade set ups.
I believe there is more downside to come for GBP and Euro currencies. I am short Cable and will be holding this position but I am also looking at getting some more bearish ensure on Euro most likely by shorting the EURJPY currency pair.
The charts below show the 1hr and 15 minute timeframe chart analysis.
Price is currently testing a resistance zone around 120.650 and another 1hr/4hr candle closure below here would be a very good sign that sellers are trying to keep price from going higher.
If the 15 minute chart continues to squeeze in its channel/wedge like it is, the then breakout momentum could be very good. I wont enter the trade until price has broken its bullish trend on at least this lower timeframe and perhaps breaks below the 15 minute 50EMA. From there, a trendline break and retest would be good.
I am looking to enter in to a Volatility Index futures trade this week prior to the U.S. unemployment data release on Thursday (NFP). It is a U.S. public holiday on Friday so liquidity/volume will likely be reduced through their trading sessions.
Remember to take your time, be patient and wait for price to find its support/resistance and form a trend before entering any trades this week. Good trade set ups will appear if you wait for them.
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DISCLAIMER: None of the information posted on this site is to be considered investment/financial advice. Trading is high risk and you should only trade with money you can afford to lose.