And now for something a little different
But still on the dark side....
The larger picture:
The USD\EUR has been in an uptrend for years. Recently, the market rose 3-400 pips from Dec 15 to the 26th. During the last 4 days it has been in a sideways channel about 100 pips wide.
Yesterday and today saw some of the largest supportive volume spikes since Dec 15th - and they happened near the bottom of the channel. So when I sat down to trade, I just waited for the next volume spike in the lower half of the channel and got in. See Chart #1. The volume did not carry the price too far through resistance and the price dropped back into the channel. But the lack of volume at resistance is still the dog that didn't bark. Until we start see the balance of volume change from support to resistance, the price will continue to work it's way up. I had to leave my screen so I put in a stop under the last temporary support, and was stopped out at the pink line. See chart #2.
I'm looking to get back in long on the next significant volume surge that turns a downward price action back up - or causes a sideways action to move up. When a price keeps going up, up, up, you have to ask yourself everyday - how long can this go on? Well - a long time. Imagine if you had entered one long position in December of 2002 and just held on (3rd chart). What could you do with an extra 3,600 pips in your pocket? If you look at the third attachment, you can see that there may be another 500 pips up before we hit the return line- if the current long term trend continues.
One of the reasons I am so interested in Nathan's sub minute trading, is that good long term opportunities to enter the EUR/USD safely don't happen along all that often. It often feels like it would be more interesting to watch paint dry. I've been casting about for an activity to keep my interest piqued that has some hope of being something other than a drain on my account. - so far my results from trying my hand at Nathan's sub-minute technique have been too dismal and embarrassing to post. I have yet to be able to distinguish these short term support and resistance patterns in real time.
JO
risk disclaimer: I am a losing paper trader (I have merrily blown through several $10,000 demo accounts). I have only recently begun to break even and see my account balances pull up from the basement. The trades and comments shown below were selected out of many losing trades that in retrospect had no valid reason for entry. This example may simply have been blind dumb luck. (but I don't think so.....)
P.S. I'm long again from 1.3620 at midnight for the reasons stated above - not as much volume as I'd like to see, but a clean entry on a swing low with a tight stop meant not a lot to lose..