- Steven
- Jan 8
Our insight into momentum and volatility has generates a few ideas. We have taken the law or essence of momentum and having fully embodied the perspective found a rich source of nourishment. The way price action unfolds itself and is naturally understood through momentum is so contrary yet in a few ways I have already seen how complimentary it is to our standard approach.
Today after reflecting and talking out the ideas we have reached some definite and testable conclusions. Three pairs were analyzed, the best we could at this moment, which we will come back to tomorrow to see how we did. I will also be looking at all my other pairs through this lens and aiming to trade many small positions to become more familiar with the new ideas. I aim to take at least small 10 positions today and tomorrow.
I am looking currently at the eur/usd and noticing 1.1678 being a key area on the 5min chart.
Good trading.
- Steven
- Jan 6
We analyzed a few pairs today going through the two from yesterday. Price is developing nicely on the eur/$. As i write this its testing 1.1730 that previous trend line and 78.6 fib area. From here the bearish wave will attempt to resume its trend to the downside whereas structure broadly will be attempting to establish higher-lows. These two ideas will come into conflict sooner or later and it is this conflict that might produce some opportunity for us.
The $/chf was squeezed slightly into the lows at 0.7910 where we were looking for bottoms and an s-wave. We found our bottoms but no entry pattern. In hindsight we can see across the waves moving into the trend line deceleration into the lows, an increase in volatility on the second bottom and a higher low test. In absence of structure our speculation must then rely on information pulled from volatility changes. It's a more fluid and spontaneous type of analysis that emphasises movement in the present moment; thus momentum is key. The conclusion 'trade off the lows' is bounded by momentum. The position is over when price is no longer moving off the lows. Compared to structure where price is permitted to move around in broad spaces either direction yet still carry throughout the whole pattern some underlying properties. In here we find again that common distinction that permeates life; discrete units vs a connected whole or particles vs waves.
Good Trading.
- Steven
- Jan 5
The New Year is here and we found right on market open a position on the eur/$ that has moved between 4-5x our risk. The setup itself has some interesting dynamics, which we walk through today as we analyze where quality is found and where risk is present. Putting these together would lead us to evaluating this trade as good quality. The sources of quality and sources of risk must always be kept in mind. The sources themselves give us our expectations and tell us how to manage the position as price develops from our point of entry.
Good Trading.