Rocking trade Chris.Nicely done. Wish I could get at least 20 - 40 pips from that trade. Really enjoy your thread every day. 
Personally, I make sure I liquidate all positions for the weekend, but Im glad there was a trade in it for you, with all the Cyprus stuff ongoing, I expect the Euro to get punished further (if the ECB doesnt manipulate anything).
Also, just read your article. I wanted to say Im glad our conversation/experience has managed to be translated into something positive for the whole trading community to benefit from.
Happy trading!
Hello Traders,
I think we have to keep talking about the Euro as it has taken the main stage in the global markets. You will notice from the image below the pair only filled half the gap, and has resumed selling while being parked near the daily lows. I expect the situation is Cyprus to weigh on the pair and EZ for several days, so will sell any corrective rallies into resistance.
Look to the 1.2890, 1.2920 and 1.2950 levels for stalling and price action signals to get short, but downside is now open with 1.2900 gone, possibly heading towards 1.2690, and potentially 1.2400 medium term if this situation gets worse.
Also Iāll consider selling EJ on rallies towards 124/123.80 targeting 122 and potentially 119.
Good hunting for today.
Kind Regards,
Chris Capre
Hello Chris,
Thanks for the analysis on EU to look for better opportunities to sell the rallies. Hopefully we can see some retracement to the levels you suggested before see the continuation pattern.
Hi Chris
Hope you have fully recovered and are well.
Asked a question here in the forums regarding market gaps. Although there have been many views nobody has provided an answer so far.
Maybe you can assist me and enhance my knowledge please.
What actually happens to trades that are current during a market gap?
Lets say someone bought X currency pair because the believe the market is going to rise.
Over the weekend the market gaps up or down to X price +/- X pips.
What would the trade look like the after the weekend?
Would stops be knocked out if they are less than a gap down making it effectively a losing trade?
Would there be an increase in the value of the trade if the instrument gaps up adding value to the trade?
Just as the EUR/USD pair gapped down, the same happened on the AUD/JPY pair, although the gap was filled by about 4pm GMT on the 18th.
Look forward to your reply.
Kind regards
Spuzz.
Hello Spuzz,
Good question>
Letās say you are long EURUSD last friday and keep the position going into the weekend close, being long say at 1.3030 and the market closes at 1.3050. Lets say your stop was at 1.2950.
Then the market opens and gaps down to 1.2900. Your stop would have been ākickedā which means price jumped over your stop. This is because stops are āmarketā orders, meaning when price gets to them, they are executed at the next price from the market.
However with the gap, the next market price is 1.2900 which is 50 pips below your order, so the broker must work to exit you out at the next price. So you essentially get out at 1.2900 which is 50 pips below your stop.
The opposite is true for if you are short the same scenario, and your stop was at 1.2950, but the market gaps down and opens at 1.2900, then the broker will exit you out at the next price it can get for your liquidity. So youād make an extra 50 on top of your TP.
Hopefully that explains it and how gaps work.
Kind Regards,
Chris Capre
Hi Chris
Gapping it seems can be:
a) A brilliant unexpected gift if you are on the right side
b) Very dangerous if you are on the wrong side and donāt build a rule based system for dealing with it in your trading plan
Got some more thinking to do on this.
Thank you for your help
Kind regards
Spuzz
Hello Traders,
The USDJPY has weathered the gap down, filling the gap and forming two HLās (higher lows) in the process. I talked about in this weeks FX market commentary to look for buy signals off the 94.50 key support level. The pair formed a daily pin bar off the 20ema, and then on the 4hr chart formed two with trend pin bars showing the dips are being used as buying opportunities (chart below).
Now the pair has to take out the key double top resistance at 96.50, so bulls can look for a breakout pullback setup, or a corrective pullback towards 94.50. Bears can look to the upside resistance for price action signals to sell the pair should the level hold.
You can also see how I trade the pair today off the 95 level and took profit +94 pips later just before market close with the chart below from my brokers chart;
Good Hunting for today as I suspect the Cyprus situation isnāt going away now that ATMās are starting to get low on cash and the banks are closed till next tues (can you say bank run or jog on the way?)
Kind Regards,
Chris Capre
Great play there, the price is in a kumo, so I didnt actually trade this, however, I did manage a 1:1 intraday play yesterday on the pairā¦ And a bank run? That sounds like a nice way of putting it!
Happy trading.
Very good trade Chris. Yesterday, I tried a EU short but spikes got me. No trades for me at the moment.
Apex,
Any trades for the day ?
Hello Traders,
Watch WTI Crude Oil around $92.00 which has been a key level in the past on the 4hr chart. If it holds, could be good buying opportunity.
If it breaks, we could be seeing a deeper sell off, so watch for price action signals there.
Kind Regards,
Chris Capre
Haha! Absolutely! There was a bearish engulfing bar at the top of a move on the EURUSD 4 hour (NY Close charts), managed to get in at the 50EMA and made a 3:1 RR
Its been a quiet week for me reallyā¦ Considering theres been so much action, I havent managed to make enough trades to capitalize on itā¦
Theres just way to much consolidation for my likingā¦ But hey, to be the best trader (one of my goals - as arrogant as they may sound), I have to be ready for all climates, and since Forex is full of consolidations, I have to learn to take advantage of them far more than I am at the momentā¦
But yeah, 3:1 today for me, nice play I think, Howād your day go?
Nicely done. Do you have a screenshot from your brokers chart showing the trade entry and exit?
I always like to show these - or have my students show them so others can learn from them.
It also helps to build āmirror neuronsā which work to mirror success, so this helps to build a more successful trading mindset.
Thus if you can post a chart - it is always appreciated.
Kind Regards,
Chris Capre
Ok, iāll post a screenshot right here, I dont use my brokers charts, but I use MT4 for my analysis. Heres a screenshot. Never done this before, so sorry about the quality, haha!
Nicely done. What broker do you trade with?
I trade with the biggest retail broker (I think), dont really feel comfortable saying it in an open forum tbhā¦ But yeah, theres my trade, as you can see, my charts have been heavily influenced by your charts Haha!
Hmm - you cannot post a chart from your actual retail broker? How do they not have charting available or allow you to post a screenshot from the actual trade itself?
Just curious.
Kind Regards,
Chris Capre
My broker does have a chart, but its not updated as fast as MT4, but because they are the biggest in the game (I think), I feel as though my money is safe in their hands.
Hmm, generally MT4 is slower than most broker charts which are not going through a bridge or second hand software.
But are you not able to post a screenshot from your brokers chart showing the actual trade and chart itself? I do this all the time as you can crop out just the chart and post them in here.
Let me know.
Kind Regards,
Chris Capre