Jupiter replies to: Technical Analysis Fallacy


Hi friends, just wanna share something and would like to hear how would you guys cope under similar circumstance.

This few months I have been intensively sharpening my trading skill, and trying different trading style for various market condition, sometimes I wondered whether ranging market (no thrust even in 5 min tf) is a good market to trade.

The most recent example from yesterday, I entered short EU, NU and long UC with their immediate term movement (3 days) and weak stock market in mind before the big move. USD apparently became weaker after US open, but there is something strange, UJ also became stronger, this indicate risk on mode as I can’t see anything bad from JPY side. However, yesterday stock market also fall all day long.

This tell me it is pure currency move, and the main driver is USD rate hike, only the expectation of rate hike easing off will prop up USD, however, if thats the case, all 7k will be in sync with USD being the weakest.

And when UJ finally turned down, which coincided with USD weakness, GBP and EUR seems to fell out of sync. All this has caused me to have more confident in holding my strong usd trade and keep rescuing.

All those position are still sinking, so this has caused me to reassess whether I should trade the range and keep rescuing unexplainable move
1)the biggest drawback of rescue is that we have to babysit all our rescue as long as the whole rescue operation last, this is just impossible as we will have to sleep? leaving resuce overnight is akin to suicide as when mega move come, the book might even break.
2)If I have to rescue and leave overnight, my initial position will be so small that even all rescue sink, my book wounld’t be affected much, well this is just cost ineffective given all the effort.
3)It is also not feasible to force rescue before we stop babysit when market not allow as market will pierce through our rescue and greatly increase our position size
4)ranging market is very irregular, its central point shift constantly, given that I have a hard tp (at least 20 pips) for all my position after considering cost-chance to breakeven, ranging trade could last into overnight if tp is not touched.

I also see some potential danger after yesterday trade
1)the move did not start after news, or anything important after checking reuters and the fx calender, it is less likely to be a stop hunt and can be a legit move
2)I have huge weak USD directional risk.

Some strategies I could implement in the future
1)implement butterfly strategy on long gbp and short CAD, NZD from their recent performance, if 7k in sync I am protected and gain the most when they tear, it is pretty unlikely both leg snap back.
2)do not trade range, thus no need to rescue, just enter full size when trend is detected, because the trend is out of sync, I will have to spread across different pair and preferably those pairs that show strong currencies move on the immediate term

This way I could have joined the party instead of getting sucked on the rescue, of course one could also cut rescue/ scout and join the other side, but I think this is my own weakness as when position is commited and the adverse price movement is unexplainable, I tend to fight with it.

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