[Trade Signal] – Yawn… Another dull day in Forex

Generally speaking its turning out to be yet another dull start to the week. But then this has generally been the pace of things in Forex for most of this year.

[Forex] – Update

GBPUSD – GBPJPY – EURUSD – EURJPY all range bound in one form or another. Right now I’m sidelined waiting for things to develop and start looking a heck of a lot more interesting than they do right now.

On the higher time frames you can see similar ranging patterns develop highlighting that again for trending strategies we should be cautious and consider cash as the best option

EJ-Oct-28-13a

GJ-Oct-28-13a

GBP-Oct-28-13a

EUR-Oct-28-13a

[Futures] – Update

Dow stock index Futures continue to be the darling trade of the month for me. Originally starting longs at 14,800 I closed out at 15,500 on the button late on Friday, not wanting to quibble over the 50 points to the expected target level (which it has reached quite easily overnight)

Right now Im looking for longs again thinking we might see one final push up and maybe past 15,600 levels before anything else might be considered.

Short trades are now also a consideration as price is at the larger time frame channel highs. Generally its a great location for the next something to happen

YM-Oct-28-13a

 

[Trade Table]

No open or pending trades – will update if something new develops.

This page is updated periodically through the day. Please check back regularly

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Why trade a portfolio of markets?

Whats the big deal? I’m a currency trader… no wait I’m a stock trader… hang on a moment I’m a Futures trader…

When you tell someone what you do what do you tell them you trade? Inevitably if you don’t say that is usually what gets asked next (assuming the person is actually interested)

This question of what do you trade? will come back and haunt me and thinking back on the way I’ve expressed what I trade to people I’ve normally said I trade the financial markets, currently I specialise in Forex. Which is for the most part exactly what I’ve been doing for the last 11 years.

More recently I’ve been questioning the logic of this specialisation as during past several years we have seen a massive boom and generally have had the luxury of not needing to look anywhere else for trading opportunities. But when you are sitting patiently month after month seeing the volatility get smaller and smaller and the trends shorter and shorter you really have to ask why specialise.

I was reminded recently of a saying I was very fond of which was;

If selling Beanie Bears on eBay ever becomes the best use of my time and money, then I’ll be on eBay selling Beanie Bears

Well it’s not quite to the point of messing around with eBay just yet. But as a stock to trade… why the heck not.

Whats in your portfolio?

When most folks think of diversification they are thinking in terms of different stocks from different sectors in their stock portfolio. This approach while good is these days only a partial answer to a bigger problem.

You still have all your eggs in one basket.

Try a portfolio of markets and diverse instruments

I might only look at 4 currency cross rates to trade regularly and I regularly get asked;

Why don’t we look at a different cross rate?

When Forex is slow and sluggish then the market as a whole is pretty sluggish. To me it then seems a little pointless looking at another cross rate to trade when the market as a whole is sluggish.

The solution for me is to have fingers in pies. To have a little exposure across several markets and instruments in those markets. I refer to this as a portfolio of portfolio’s

Spot Forex – Stock index Futures – Individual Stocks – ETF’s – Bonds – Metals – Softs

This is how I’m moving my own trading to have a little exposure in at least 3 different markets. The logic is that when Forex is quiet and in waiting mode, stock index futures might just be on the move as might gold and a couple of stocks. Long term the idea is to build a portfolio of portfolio’s as there should be something always moving.

This can be scaled quite well for the little guy (or gal) spread betting 1 currency 1 index future 1 stock all the way through to multiple assets and multiple vehicles

 

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