FX TRADING STRATEGY
time frame the more time for new information to reach the market. We only want to be in a trade for as short a time as possible when the market is the most active and we will seldom fade
the most current 30-minute
trend. Fading the trend is an expression that you think the market is wrong and you are right. We are not casting any judgement on being contrarian because it takes all kinds to make a market and there are many ways to skin a cat. However, in the space in which we are operating there is very little room and precious little time to pull consistent profits out of the market on a daily basis if you are contrarian. Knowing how tiny we are
Trade zone #4 is between 13:00 – 14:30 and when liquidity is back in the market after the lunch hour and traders have a shot at extending the trend. This is also when the first of the U.S. players start making their presence felt.
Trade zone #5 is between 14:30 and 15:00 and the time when most U.S. data is released. This candle will serve as a pivot for the rest of the day.
Trade zone #6 is between 15:00 – 17:00 and the final window in which to enter a trade if the ATR has not yet been completed. If the market has traded in a narrow range the odds increase of an explosive move towards the close as the market should keep pushing until it completes the full projected daily range. Also, that late in the day all the economic data has been released so in terms of news there is nothing
40 FX TRADER MAGAZINE April - June 2013
left on the agenda to cause a shift in sentiment
WISDOM OF CROWDS VS. CONTRARIAN FOOLISHNESS
Price can get from A to B in a thousand different ways and the higher the
compared to the overall market our methodology is to be in synch with the market and fine tune our strategies to the volatility. We trade without a bias and have no opinions because they only limit our response when it comes to cutting losses. We simply want what the market wants.
Chart 1.2 EUR/USD futures shaded green during the ECB press conference on March 7, 2013
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