Posts Tagged ‘Fundamental’

Busy end of the week

Thursday, February 4th, 2010

We got plenty of fundamental announcements for what is left in the week:

Thursday: Interest rate announcements for the Euro and GBP
Friday: Unemployment reports for the USD and CAD

And if it wasn’t enough:

All G7 meeting Friday and Saturday

Its going to be difficult to open a trade tomorrow, I’ll have to close it before the NFP announcement… so I guess I’ll only be watching…

Be careful with these announcements! Don’t put at risk what you have earned following your system.

Trade Safe!
Raul Lopez

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The Unexpected Event

Friday, January 15th, 2010

Yesterday I was talking to an old trading pal about the impact of the Aussie unemployment report (real good numbers by the way, jobs gained were +35.2K and the market expected 10.2K and the unemployment rate was 5.5% against 5.8%). Anyway, he traded that report, just a few seconds before the announcement he went long and held the position for a few hours making a quick pip there.

Of course it is always good to get pips here and there, but what I always keep in my mind is the alternative history (in the economic arena this is similar to the opportunity cost). In this case, what if the market went down instead? (You know sometimes the market moves against the fundamentals), even if you use SL orders, the market could gap then your loss will be unbearable to take, you would wait and see if the market recovered but it continues to move against you. The worst scenario here would be to blow up your trading account just for a quick pip: this is the results of your alternative history, are you willing to take this type of risks?

Lets put it this way, if you keep trading the unemployment announcement say for 2 or 3 years, the “unexpected event” (of the market moving against you after that announcement) will arise sometime during that period and the result will be devastating. I ask you again, are you do you have a shield for the “unexpected event”?

Please feel free to comment.

Trade Safe!
Raul Lopez

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Looooong Weekend

Friday, January 8th, 2010

I like the first Friday of every month, not because how the market reacts to the Non-Farm Payrolls announcement, but because I take the day off (Actually, I did write this post yesterday and scheduled for today).

It’s very difficult to trade the most important announcements, the market goes crazy making wild swings, and most of the time the market ends up where it all started. I think this is the kind of risks that traders should avoid, we just can’t afford it. Picture this scenario, you been trading all month long, following your strategy but somehow you decide to trade the NFP announcement, and all you’ve made during the previous month vanishes. I just don’t like the idea.

Even if we knew the actual figure, it would still be difficult, because sometimes the market moves against the fundamentals, good data, and the market goes down, bad data and the market goes up, very bad figure and the market stalls, etc.

This is why I take the first Friday of each month off. What do you think? Is it worth it?

See you next Monday! Have a nice Weekend.
Raul Lopez

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EU and UK Interest rates

Thursday, November 5th, 2009

Earlier this morning both interest rates were released. The ECB and the BOE decided to hold interest rates at 1% and 0.5% respectively, as expected. Still, the market reacted a little on both announcements.

What do you think about your trading so far this week?

For me it has been difficult to find low risk trading opportunities with all these important announcements, yesterday the US interest rate, today the EU and UK interest rates, tomorrow the NFP announcement (probably the most important fundamental announcement). This week was more fundamentally driven than technically driven, and I like to trade based on price action, market sentiment, etc. So probably that is the reason its been kinda difficult… Did you think the same?

Anyway… One more day to go, and this week will be over. I have a feeling next week we’ll find more trading opportunities than usual (most currency pairs are trading at important levels, waiting for tomorrow’s announcements…)

Next week we’ll also be trading in the FREE TRADING ROOM, don’t forget to register.

Good luck!

Raul Lopez

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GDP and more

Thursday, October 29th, 2009

The US GDP was announced earlier this morning, and it came out better than expected (3.5% vs. 3.2%). For the first time in more than a year the US is showing an expansion, this makes traders and investors think about the recovery of the world crisis, is it over? I don’t know, but certainly this is very good news for all of us.

We know everyone’s main focus right now is at GDP numbers, last Friday, we the market took a big impact because of UK’s GDP, today the same happened on the US figures, so expect a lot of impact in future GDP releases.

Now, about technical analysis, I would say the best thing to do in the Forex Majors is to wait for the next week, then I think we’ll have a clearer market condition. Something interesting could be developing in the EURUSD and USDCHF, but we’ll have to wait for further confirmation.

My main focuses right now are:

GBPCHF, which is in a clear bullish market condition and I’m looking for long trading opportunities, and

EURGBP, which is in a clear bearish market condition, and looking for short opportunities.

Trade Safe

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