The Week of Monday 7th December 2009

On Monday 7th December we didn't have any clear entry signals. This is not uncommon when you have a very strong move the previous day (especially when that strong move is caused by news). It's sometimes as though the market needs a bit of time to 'normalize' itself.

On Tuesday, we didn't have any trading opportunities during the London Session. Price just kept bouncing off the relevant Support and Resistance levels. We eventually found a good opportunity to go Short when price breached the 1.4791 Support line around the beginning of the US session. Entry was at 1.4791 and the first position was closed 30minutes later at 1.4752 for a profit of 39pips. The second position was stopped out at 1.4720 during the Asian session for a profit of 71pips.

Wednesday's trading started with the market drifting upwards. We were looking for an opportunity to go long but it didn't happen because price closed too far away. It turns out that we didn't miss much because price soon made a u-turn without quite hitting what would have been our first profit target. We ended up staying out of the markets on this day.

Thursday's trading was very similar to what we had on Wednesday. The market never got around to giving us a convincing break of the relevant Support or Resistance lines. It became quite obvious today that the market has been bouncing back and forth within a closed range. If anything, this situation made us look forward to Friday's trading with an expectation for a strong breakout move.

I anticipated a strong breakout move on Friday and we weren't disappointed at all. The only issue was that the market faked us out by first of all heading in the opposite direction. We initially entered a Long position at 1.4768 around 12:30pm but we got stopped out at 1.4742 about 2hours later for a loss of 26pips on both positions. The next opportunity came around 3:15pm when we entered a Short position at 1.4682. The first position was closed at 1.4663 for a profit of 19pips. The second position was closed at 1.4611 around 6:15pm for a profit of 71pips.