One amendment to my trading plan for 2015 was to not solely focus on stocks, but also keep an eye on a small number of forex pairs or commodities, simply to give me some diversification. As we have seen in recent months, there have been some major trends develop in these instruments.
All I am doing is looking for the same setups and basic criteria that I do when looking at stocks - a good enough method will be robust enough to trade almost anything.
Yesterday I took a long position in USD/JPY. Time will tell how it pans out - it may quickly fail, on the other hand it may start to develop a decent trend.
A couple of traders I mentor have done very well in recent months trading some forex signals. They are currently still short the EUR/USD, and also got into a long trade in the USD/CAD in early January.
What was great about this particular signal was that, on the day of the breakout taken, the volatility factor indicator was at its lowest level for several months. Based on the way we try and identify potential set ups, this is exactly what we look for - a contraction in volatility, akin to the coiling of a spring, before price finally breaks out with the resultant expansion in volatility.
Nice trade, I guess according to your rules you're still holding?ReplyDelete
Yes still holding until my stop is hit.Delete
Diversification is good by the way! I wish you good luck in all of the fields: foreign exchange, stocks, commodities etc.ReplyDelete