The market is at an interesting junction right now, rumor and counter rumor cause swift alternation between 'risk on' and 'risk off' scenarios making it difficult to take either position or swing trades. This is why at this point I shift my focus back to forex scalping the 1 minute charts and scalp both the Euro and the index futures (FTSE, CAC, DAX and the DJ). The currency markets appear to be manipulated by central banks and big players, so I don't really trust the normal trading systems I've been using for swings.
However, scalping the 1 and 5 minute charts still works well and the idea is to reduce risk as much as possible. This means that a trade either works straight away or I exit with a small expense. I have also reduced the trade sizes and once in a while a scalp becomes a swing and the reward is then greater.
This situation will IMO continue until more certainty prevails, which may take a while still, with Greek elections and wobbles in Spain, Italy and Portugal. Even the GBP seems difficult to trade and wild swings (small ones albeit) seem to happen daily. Just this morning we saw Cable drop around 80 pips in 45 minutes on QE fears and then climb back 80 pips over the following 4 hours, ok to scalp to swing, but wouldn't trust a swing with a wider stop.
I use the EUR/GBP as a thermostat for changes in both EUR/USD and GBP/USD and am aware that the US session often brings about a complete reversal as the GBP drops and the Euro rises.
So all in all, scalps remain my modus operandi at the moment and for the foreseeable future.
To find out more about my scalping methods search this blog for scalping, there is a search box on the upper right side. Have a good trading day and I recommend staying out over the weekend as it's impossible to know what sort of gaps will occur.
Here is a video I made a few years ago, nothing has changed which is why it's still valid now.
Trade with Stock Genius Social media triggers gives an 87% stock trading accuracy edge www.StockCertified.com
Powered by Facebook Comments