Lots of rambling talk in the markets this morning with talks of lots of stop orders just below 1.4300 and lots of sell orders above 1.4370 and a 1.4350 option expiry at the close of New York’s session not to mention dismal Eurozone economic news continuing to pour out and I could go on and on…
But what did stand out to me was the Chicago PMI data that I mentioned I would be watching in yesterdays trade analysis, and it came out much better than expected (60 instead of a consensus of 55) and so I immediately placed a second sell order at the 1.4300 level. It’s now been about an hour since I placed the trade and it is looking like the market is very hesitant about moving below 1.4300, so in the meantime I have tightened my stop/loss on yesterdays trade and will watch this new one closely for a break of my (13) MA on the 15 minute chart.
Update: So as is known to be the case whenever you trade in low liquidity markets, several other news events blew any chances of a short working out. Primarily we had the Federal Reserve Bank of Kansas City’s monthly manufacturing index come out much lower than last month 10 from 17 in November, as well as a bomb scare in Times Square, none of which should have much of an effect, but this is not a normal market. So I lost 39 pips on this trade but also closed out my trade from yesterday for a 87 pip profit. We’ll try again next week as the market comes back into full swing again.
Many folks take this stuff for granted, and I guess that their money making success is lacking because of it. There is such a tendency to look for the elusive Holy Grail that the majority of them end up destroying their own chances at success. A little look at the real world helps everyone to keep our footing in a treacherous market.