Welcome to my blog! This is where I discuss my investment and trading strategies, my analysis of the financial markets (primarily Forex right now), and discuss the trades that I make. Today, I’m analyzing the Forex market for December 12th, 2023. Read on to see my thoughts.
I had a strange night Saturday, where I didn’t go to bed until after 3AM; which caused me to not be able to really go to sleep until like 1 at the earliest for the last two nights. I’m tired and I need to get back on a better sleep schedule. And since I went to bed late, I woke up late, so I was only really able to make myself a protein shake before getting to the computer this morning.
I understand that I might want to be in a better mindset/headspace to trade effectively, but at the same time a little tiredness shouldn’t deter me, and I should still be able to make good decisions. The US market has been open for over 10 minutes now, and I’ve got my pairs sorted (the top half of volume receivers this morning, in ascending order), so I’m ready to dive in.
I’ve been trying to be less of a “hybrid” trader, and to be a bit more strict with my rules. So, while I saw a couple more things that looked like they could be viable this morning, I only pulled out the 4 pairs that were moving more closely to the way my parameters dictate. Below are those four pairs. Maybe going forward, I’ll still pull out those other charts so I can keep an eye on how they move, and if a trade might’ve worked out.
CAD/JPY – Short
I noticed already that three out of the four pairs I pulled out are JPY pairs. There must have been something there. Anyway, this has been down since noon yesterday, but it bottomed out this morning around 7, made a pretty strong rally up to the upper band, and has been pushing down since then.
Immediately, I see something I don’t love, and that’s the fact that on the spike the RSI never even really pushed up above 50 much less got into overbought territory. But on the other hand, price has returned to the downside and RSI being below 50 should be a bearish signal.
It’s somewhat of a wild swing but price made another spike again this morning after pulling back, but it simply made a lower low on the morning. Right now, price is stalling at the area it bounced off of with the second push I just mentioned, and seems to be struggling to push through this area.
I like this to the downside, but I’m also wary around trading the break of a support level, when that level is also resistance immediately preceding the move I’m trying to trade. Overall, I think I have more reasons not to trade this than to trade this right now, so I’ll hold off.
CHF/JPY – Short
This is another scenario where I’m somewhat ignoring the RSI, but other things seem to be lining up. This has been kind of down over the last day-and-a-half; and moved sideways overnight. Very early this morning — around 3am — price pushed out of the lows of the range, then fairly quickly pushed up to through the highs and the upper Bollinger bands, but wasn’t able to hang on to the strength. Despite pushing through the upper band 5 times (significantly, 3 times), price never closed above it (I’m on the 15 minute chart).
Over the last hour, price has been pushing back down, and is seemingly stalling at the MAs in the middle of the bands. This stall, though, looks like it could be a good entry opportunity, so I think I might just look for shorts. Price is sitting on a support level that’s acted as support more often in the past than resistance, so it doesn’t feel like I’m trading “through” those levels with this trade. I’ll run the numbers and hopefully set an entry order.
After a cursory glance, I think I’m going to hold off here. On the 5 minute chart, the bear rally that I was going to short in to was too deep (with the spread) to offer a risk that would provide a good R:R given my original target. If I move out to the 1 hour chart and pick a target there, I can get my numbers, but that starts to feel like I’m just trying to find a way to make the trade work, rather than trading what’s in front of me.
GBP/AUD – Short
This is an interesting one this morning. And maybe I should disqualify it anyway because if I zoom all the way out to a 2 hour chart, this has been in a wide range for a long time and we’re still a bit off of the highs. It’s been ranging for a few months, though, and there’s been some chop within that time period. So it’s not out of the question that this could be ready to make a decent push down.
Price bottomed out overnight here, and over the last three or so hours, has been spiking. This spike is fairly outsized, but I’m not sure it’s so outsized as to suggest a reversal to the upside (though the price action as I’m typing this might suggest otherwise).
This spike pushed up to and through the upper band; had a bit of a stall initially, but is making another strong push up. Know what, the more I type this out, the more I realize how strong it is. It no longer appears to have weakness behind it, so I think I’m just going to leave it alone. RSI is threatening overbought territory, but the slower line hasn’t quite gotten there yet. I think I’ll just set an alert here to let me know if things change, and move on to something else.
USD/JPY – Short
On one hand, this has made an outsized spike that I could argue is a reversal move to the upside — especially given that RSI never got into overbought territory. On the other hand, price has failed at the upper band, and appears to be seriously threatening to push back down. Is this just another higher low in the midst of starting an uptrend? Or will price actually push down? I guess that’s why we set the orders: to find out.
Dropping to the 5 minute chart, Price almost looks like it’s rolled back to the downside, and actually is showing me a pretty clean bear-rally right now. There is some resistance at this area, but there’s actually more support. I can see here already that the number should line up and the spreads not terrible, so I’m going to take a shot here.
Thanks for reading! What did you think about today’s analysis? Let me know in the comments below. And stay tuned for more Forex market analysis and trades.