Dollar continues to correct

Looks like the Dollar correction I predicted is going to be a little more intense then I originally thought. Seems that the little channel we identified has now been breached. Also notice how the MACD has broken zero on the chart:



If you are a fan of Elliot Waves and retracement in general, Action Forex knows its stuff. I don't always agree with their analysis, but they get it right a lot:

Mar 13 09 07:57 GMT:
"The greenback generally weakens today as consolidation continues, based on improved market sentiments following rally in US and Asian stock markets. As discussed before, a short term top is in place at 89.62 after the dollar index completed a five wave impulsive sequence (81.62, 79.63, 88.24, 85.64, 89.62) and the index is now correcting the whole rise from 77.69. We's expecting some strong support from 86.81 cluster support (23.6% retracement of 77.69 to 89.62 at 86.80) but after all, the key level is 83.58 cluster support (50% retracement of 77.69 to 89.62 at 86.65). Outlook will remain bullish as long as this support zone holds and up trend from 77.69 is expected to resume after the current consolidation. Above 88.53 minor resistance will be the first sign that such correction has completed and will turn focus back to 89.62 high."

MT4 platforms are different, so be careful.

A little embarrassing...but I have been using this MT4 platform for all my trading...and this evening I cost myself a few thousand dollars.

Last night, I ended up going long 6 Lots of the Sterling/USD and did well with it. The only problem was, I set a sell stop order at my pre-determined "get out" price, but the MT4 treated it as an order to short the 3 Lots, while maintaining the longs! Ouch. Other trading platforms don't do this, so I will have to figure out why the MT4 is different, because it is a great program otherwise.

So instead of my equity being at $154, 000, it is still at $148, 600. As you can see by the statement, I still ended up ahead.

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Ozzie/Yen trade below did not do well. My take is that the equity markets positive performance lately has made investors of the Ozzie, as it is notoriously a risk-appetite currency. The Doji doesn't always work...this was one of those times.

Using Long-Legged Dojis

I think this is a classic short here...It's a small trade in the AUD/JPY. I made it small because I have no backup fundamental evidence. Daily DOWN trade triangle was just issued today.



Account balance update here. Still doing very well.

Fibonnacci trades will make money...Video

Just did a video on a gold trade I already closed for a profit. It's a short thing on how Fibonnacci really does work.

Using Bollinger Bands

Just bought 1 Lot US/Yen. Nice breakout. I think the Dollar breakdown I talked about a few days ago might be over, at least for a little bit. We'll have to see what the equities do today. My trusty trade triangles are showing a little oversold and the dollar on the daily has bounced a little off of the middle Bollinger Band.

Use the software that has been one of the important aspects of my success for free, here. I did...and then I became a customer, for obvious reasons.

Gold post

I lightened up on some of my long Gold positions and bought more at the 899 level. I also covered my shorts from the 920 level and added $2800 in equity.

(Now working on rebuilding some lost equity. I have made some nice profit on shorting the Sterling/USD.)

Seems like we are at a base in Gold for now:



This is a continuation of the Gold chart I showed the other day.

Trading Forex Using Equities

If you are planning any risk appetite trades based on how equities do over the next day or so...I would suggest that we close above the gap between 1353 and 1375 in the Nasdaq chart below, before we deem today's action as the beginning of the bear market rally that many are expecting.

If I wanted to be a little more conservative, I might wait for two closes above the gap. If I wanted to be even more conservative, I'd wait to see the same strength in the S+P, as technology has performed better then most of the other sectors, even during this precipitous fall.



Get my account update here (Jan 2 to today.)
To see why I am doing so amazingly well (even though I have had a couple of ugly trades recently,) go here.

Recordkeeping

Since it is not Forex I won't talk about it, but occasionally I buy an equity that looks sound technically. Since my platform does not let me buy equities, I have to record it this way.

A new Fibonnacci Test

Gold has done some serious selling today. I am still long and short, however I just added a 1 Lot long position because we are due a retracement:

DX Resistance Still Holding For Now

Slow day in Forex...really doesn't look like there is going to be much in the way of news this week either. As I write Nikkei is down 1/2%, so I can't get much of a read as to what equities are going to do later. A strong market will probably push the dollar down and then I can look at getting into my Euro/US and US/Swissy positions again.

I thought it was interesting when Matt Nesto of CNBC pointed out that, through last week, equities had 4 straight losing weeks...something very rare that I was not aware of. Then again, if I hear the term 'oversold' again, I am going to punch a wall!

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I have been long and short in Gold and made profits both ways. Seems like the yellow metal is rudderless for now. Also made a few scalp (currency) trades with no losses and added about $900 in equity to my account.

Look out

I am right at the top of the channel I drew in the earlier post on the Greenback. DX very strong today, and the Sterling getting weaker by the second. UK Gov just took a 77% stake in Lloyds of London.

Bolinger Bands...thanks!

I have been trying to be more patient. If you play things right...understanding the laws that rule the human psyche, you should be able to make the same trades a few times (sometimes only twice.) Trade triangles are great because they help me see the overall trend very well...

...Then you can buy and short accordingly. Bollinger Bands are great for this. I like to make the trade and cover or sell when the bottom or top band is hit. See my trades for today so far (based on the post from Saturday.)

AND

My US/CHF trade was exited at the bottom, and the EUR/US trade was exited at the top, thanks to Bollinger Bands. Now it must be decided where and when to get back in.