Today was an absolute mess in the forex market. It’s the end of the week/month/3rd quarter and there was definitely huge amounts of capital transitioning from one place to the another. From London to NY, the sessions were filled with rapid volatility that made trading very difficult. During “high tides” like today, I need to remind myself to shoot for quick 5-10 pip scalps instead of milking every pips.
I made many mistakes today and was destroyed by the sudden volatility. I had a short EUR/USD bias from the Deutsche Bank crisis and it fooled me as it dipped below support then shooting right back up. GBP/USD was all over the place and USD/JPY did not fall as I expected to. Can’t be greedy on days like today and I sure learned my lesson.
Deutsche Bank was today’s headlines as the bank’s stock fell 6%+ which carried over to the equities having a down day. Investors are speculating if this will be another Lehman Brothers situation. The crisis has given the dollar and yen a boost today but interestingly enough, kept the euro barely unchanged. There’s talks about a bailout from the German government but there’s no definite answer. If the worst case scenario happens and the Bank falls on it’s own weight, I can see it bringing the euro down with it.
I dabbled in some trades during London but the markets didn’t start moving until NY. GDP numbers came out positive at 8:30 a.m. and the Deutsche Bank news drove the market into seeking safe havens. Volatility just happened too fast and I miss the grand moves. I need to be quicker and more nimble catch explosive moves that happens extremely fast.
Both Draghi and Yellen spoke in separate occasions which gave a sudden jolt in the market. It was very surprising to see the dollar rally then fade back below after Yellen stating of a more than likely rate hike by the end of this year. Price action definitely confused me which led to a bigger than expected losing day. Was this old news for the markets or did the markets lose hope in the Feds? In my opinion, I thought the dollar rally would continue.
My goals for this week was to consistently trade London in hopes to condition my body to a new sleep pattern. Since today was only my second time this week trading London, I was tired and not clear headed. London session actually went pretty well until things got frozen in NY. Although I was still net positive for the day, things turned for the worse during Yellen’s testament. I read her statement to be beneficial for the dollar and kept chasing a long. I shouldn’t have chased but I guess I had false hope in Yellen.
I missed out on a great London session once again. Sleep, health, and psychology are all essential elements in successful trading. I woke up at 4:30 a.m and felt too dead to trade Although I was staring at my screen, I knew I couldn’t trade since I legitimately felt like a lifeless zombie. I went back to sleep to wake up fresh for NY.
When I woke up for NY, I felt even more dead seeing that I missed out on a great session. The volatility and momentum didn’t carry over from London to NY and it just ended up with me chasing trades. I some how need to cater my sleep schedule for both London and NY…
Market didn’t move too much in the FX world this Monday, although the volatility in oil is worth mentioning. There were many speculation on controlling oil outputs and price which drove the commodity higher. There was also the first Presidential debate today with Trump vs Hillary and it was very interesting to see how the markets reacted.
Interesting to see the Peso increase, judging by the markets, it looks like Hillary may have won today’s debate.
I tried to enter some trades but the markets did not move much. The Dollar seems to be in a limbo with the bears slightly winning. Pound also caught it’s breath today while rebounding after a tough selling session. Interesting to see how the currency will continue.
Couldn’t trade today due to a personal event. The dollar gained some power against other pairs but was still wasn’t as strong as I thought. I’m definitely excited for the following week to see how the market will digest all this commotion.
The FOMC was a surprising event last night; no rate hike but a possibility is still on the table. September hike is off the table and it looks like December is the best bet. Yellen initially pushed the dollar down but investors soon faded the move by longing the dollar at support.
I scalped long dollar by fading the pound rally after the FOMC. Although there is no rate hike for September, I feel like investors still have optimistic views on the December rate hike. I think the dollar will continue it’s rally and I plan to fade the moves on EUR/USD and GBP/USD.
The BoJ is scheduled to speak anytime soon in the Asia session and by the looks of USD/JPY depreciating, the market seems to doubt the bank’s power to intervene. For a while, the BoJ has been criticized to make broken promises and their words seems like all bark with no action. USD/JPY is sitting around 101.5, when will the BoJ say enough is enough and step in? Also scheduled for NY, the FOMC is scheduled to speak which will have a huge affect in the dollar depending on their tone and guidance. The market will be at a very sensitive and fragile state until everything is said and done.
Took some losses by shorting the dollar last night. The EUR/USD and GBP/USD fell during London session but found support during NY. NY was difficult to trade, since the markets are always calm before the storm. I’m not sure if I’ll be trading a lot tomorrow depending on how sensitive the market is after the FOMC and BoJ are done speaking. Until then, all eyes on the banks.
It’s going to be an interesting week today filled with bank statements. We’ll be hearing from BoJ, BoE, FOMC, ECB, and the RBA. There will be a lot of speculation before the meeting and even have whip lash movements depending on how much of an impact the bank statements bring.
Today was a slow day with the dollar gaining late momentum in the afternoon of NY. A September rate hike probability is decreasing and the chances of a December hike sits around 55%. The main focus on this week will be the BoJ and FOMC which will greatly affect USD/JPY. The yen has been appreciating as a safe haven but it can instantly reverse. I made some profits shorting the NZD/CAD but I made the mistake to hold the trade for too long as it reversed sharply in Asia session. I’m holding a long GBP/USD trade overnight and hopefully I can wake up to profits.