My how things can change in the Forex markets! Yesterday saw a drastic reversal in the USD, EUR and GBP that, with some, just about wiped out the moves fom the day before. The GBP fell through the floor in the later European and early US session, wiping out the gains from Wednesday, moving 200+ pips in a few hours. Thankfully this was my saving grace, as some calculated, but terribly wrong trades in the Asian session had me at a substantial loss, but I caught the drop for +113 and +111 respectively and ended the day well in front.

If ever there was a perfect example of the effect a pivot line, this was it, luckily I grabbed a screenshot before the day's end which is below:


Notice how each strong move down was halted at firstly the daily pivot (the blue line), and then again and the first Support line (the red line). It shows just how effective pivots can be at times to find targets and resistance/support points for strong movements (see my introduction to pivots here).

Something to notice yesterday was the movement of the EUR/USD compared to the GBP/USD, below are the two charts on top of each other, you can see the movements were very similiar, the only real difference being the middle drop not being as substantial in the EUR as the GBP. This is a very common occurance and something to look out for if one is not following the other.

So overall a great day if you picked the movements in the European currencies, and went with the trend using pivots as your targets and signals for further movements, for me personally, while finishing well ahead, it proved to be a day of sloppy overtrading early, and then more calculated, smart trading later in my day, a bit of a "get out of jail" day. Below are my trade results (well all I could fit into the screen shot anyway) for anyone that is interested.


Coming soon will be an article on whatever topic that wins the poll on the main page, so get your votes in, at the moment it is looking like Money Management.

Happy trading!

Today's result: +90 pips | Overall: -32 pips

This entry was posted on Friday, September 23, 2005 at 1:05:00 PM. You can skip to the end and leave a response.