The market is rolling around trying to get out of bed but the alarm clock hasn’t sounded yet. The various markets are posting some minor gains and slowly but surely trickling upwards, most of these “slightly” trending pairs have some easy little entry opportunities to take advantage of that soft up movement. For example the EUR/USD and AUD/USD have been “oh so choppy” but nevertheless continue upwards, therefore buy opps on these pairs come with the occasional dip to the bottom of the alligator/darma and even down to the central pivot point (the GREEN guy). I have been following these choppy uptrends in this manner and it has proven to be a profitable method during these market conditions.
We have an entirely different situation with the other pairs, the JPY’s are all over the map, these have to be traded with the utmost caution and at best traded like we’re used to doing in the summer market. Look for 1h crossovers and quick reversals, watch for the these pairs to reach the upper/lower most levels within the daily pivot range and look for entries from those quick bounce reversals. The JPY pairs have been trading in a large range for approximately the last 5-7 months and the chop is starting to consolidate hopefully leading to a large break out, however in the mean time finding a trend is going to be pretty difficult if not impossible.
This leads us to the point that, in seeing the major pairs all over the place, we are going to be able to find good trade opportunities on some of the pairs I don’t usually trade. We have seen great steady movement on the EUR/GBP with the EUR/USD and GBP/USD not being so heavily correlated with one another, definitely keep an eye on this one. I see a good long term buy on this pair, it’s slightly overextended right now and is due for a small correction but the trend remains strong to the upside.
Pairs like the USD/JPY (which is a jpy pair but trades very differently from the other JPY pairs) is giving some great short term break out opportunities. It seems this pairs likes to be the opposite, if the other majors are moving nicely watch out for this one but it they’re in turmoil then the USD/JPY can be a nice safe haven for traders to make a few pips while the others get sorted out.
Likewise the USD/CAD, which is a pair I NEVER trade because of the inherit volatility and unpredictable movement, is following the USD/JPY is turning into a nice pair to trade while the others are out of “whack.” The USD/JPY and USD/CAD are giving some nice quick moves that have been producing some fair pips, which we’re “all about.”
Remember the market is going through a stage right now that will not last indefinitely so be ready to roll with the market and the changes it continues to make. Traditional methods of trading always apply to this market, trend, support and resistance and riding the momentum will always be the best way but we have to tweak things just a bit given the market conditions.
Good luck and happy trading,
Jared J.