I spoke yesterday how disciplined a trader needs to be and how perfect analysis sometimes leads to a day without pay. We saw yesterday, how that can completely flip/flop when the crystal ball is slightly OUT of focus. I was championing the “trade within the range” bias and ready to trade Long, after a test of Support. The test of Support part was spot on but Support failed the test and sellers pounced on EUR/USD like a cat on a mouse. The ironic part of the story is that PA warned us that the crash was coming and we made a nice trade and further profits! The lesson to both scenarios is the same of course – TRADE WHAT YOU SEE, NOT WHAT YOU THINK!
EUR/USD now finds itself at our next DCZ – 1.2775 and staring over a very deep abyss that has 1.2035 staring up from the depths. Comparatively minor Support ‘shelves’ might steady the fall but it really is a dark picture. I am definitely thinking pullback now and will not be looking to re-join the Bear’s Picnic for a while yet. An untested DP above PA looks a juicy morsel for profit takers but Surfing against this Tsunami is a risky business. I’m thinking consolidation today. As always – if it sets up we trade it but I won’t be risking too much of this week’s profits, no matter what!
The Day Ahead
Content not to trade today, I will watch and act in need but I will definitely have one eye on the weekend.
High Impact News – CET
|Core Durable Goods Orders m/m
|Durable Goods Orders m/m
Have a great day everyone.