A nice angle on the £/$ helps me net nearly 5k over the past 72 hours.
I actually placed the trade on Friday and by Monday morning I had won 10k back!
Here’s how I did it…
The £/$ was trading above its 200-day Ma (black line) and 20-day MA (green).
Then between the 25th-26th Jan 2010, it sold off below these Moving Averages, but not by a great amount.
It then stalled and made a rally toward the green 20-day Ma. It fell short once more, just at that price level of the 20-day Ma – 1.618
Then on the 28th it began to sell-off, but not aggressive enough to pick up a trade. However, on the 29th Jan it sold off BELOW 1.61 which was the precise level whereby the market rallied aggressively up through back on the 8-11th Jan (up through the 200day MA line).
I wanted to trade at just below this 1.61 level, as I was sure it was going to fall a lot more, My target price to trade was around 1.607 this was 0.3 cents below the pivotal 1.61 level, but I wanted to be sure it was going to clear this zone in a downward dash rather quickly .
And quick it was, I was late logging on and only got into BOM when the market was now trading at 1.6305
This was lower than I would have liked, as by the time I went to trade, the market had already sold off quite significantly.
I opted for a Low One Touch as opposed to my usual High No Touch. I was convinced the market was going to test support (1.59) at this point, so I placed a One Touch of 1.592. This was just above the level I though it would touch, just to be that bit safer.
I placed the trade Friday afternoon…
The target one touch level was over 1.1 cents away from current market price of 1.603.
On Monday morning, as I poured my milk over the weetabix, I logged into my account (with the other hand) and could see the trade had expired for full profit.
It had actually touched 1.585 earlier that morning, but was not trading at 1.588. I was very pleased and so were my clients, as they had got in on a high No Touch that I had recommended – A Safer Option!
My resistance level is now at 1.61, whereby it built up a massive rage downward last week. The new support is 1.59, as this is where the market closed right on Monday 1st Feb.
Today, the 2nd Feb the £/$ is trading just above 1.59, at 1.5937
If I see any downside action below 1.588 (just to be sure) I will be trading BEARS.
If a rally ensues (unlikely right now) above 1.61 and up through 1.62, then 1.61 becomes the new support.
For Indices, I am waiting for one more snap higher (like I said last week), then I will be bearish again.
I am trading tomorrow (wed), so will be in touch after that.
Very Best
Matt $haw
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