Scalping the Forex Markets
If you look at the recent Euro chart you will understand exactly what I mean, Yes, Trade what you see, Not what you think.
The Euro had made a new low on the 10th of January at 1.2870 and once that level was hit, it rebounded ferociously never looking back. So far we have had 13 days of solid gains, with the exception of 1 negative day on the 17th of January, so anyone looking for a small retracement, even say 23.6% had only one opportunity on the 17th. It is unusual for a currency to simply plough ahead with no retracement, however, with the Euro, there are extreme political considerations, some of them seem pretty dubious, making you wonder who is for who in this game. Of course, the lower the USD and the higher the Euro, the better it is for the US economy, making it's exports dirt cheap and imports massively expensive, forcing Americans to buy local produce, rather than foreign goods.
There have been plenty of opportunities for the ECB to encourage Euro sells, but for some odd reasons it chose not to do so, why? who knows. Maybe they prefer to look pretty rather than useful.
In any event, rather than wait for a retracement, or pay any attentions to the ECB machinations, it's easier to simply follow the scalping signals, as they are generated by the scalping methods I use.
When you simply trade what you see, there is nothing to believe, nothing to ponder about, it either works, or you get out fast.
If you haven't yet got hold of the Free Scalping Indicator from Karl Dittman, get it, it is well worth having. For more scalping methods, see prior posts on this site.
For a more guided approach check out Rover North.
Here is a reminder on how to trade consolidation breakouts:
- FOREX-Euro flat versus dollar but losses seen likely (reuters.com)
- Euro below 50 pct Fibonacci retracement at .3080 (reuters.com)
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