Volatility continues as the markets attempt to decipher the impact of the Ukraine invasion by Russia, the waning infection numbers from the Covid 19 virus and the imminent rate hikes due to begin in March.

Trading has been tricky since the corona virus first surfaced and it’s many implications. The pending Fed announcement of either a 25 or 50 basis point rate increase coupled with extraordinary inflation has also created much speculation. Lastly but not surprisingly, the invasion of the Ukraine by Russian troops has all kinds of implications.

Oil and gold spiked yesterday but both moved lower today.

As equity markets moved higher today, the USDCAD moved lower and a short was taken risking 15 pips for a potential 36 pips to our daily target at 1.2734. The entry was after a large bearish engulfing candle that closed below 2 significant technical levels and our stop loss was placed just above those levels.

Price moved down quickly to our target and the trade was closed. This pair moves well during the North American trading session and sometimes makes a final push after the U.K. close, but other times it can trade sideways after London. If I’m not teaching, I don’t mind leaving the trade open to see.

There is a lot of back and forth trading action the past 6 months and the trading waves are more jagged than usual. Don’t despair but don’t let a winning trade turn into a losing trade. Protect your profits but don’t compromise your discipline because the market is more erratic than usual. It’s okay to sit on your hands and not trade if high probability setups are not there. It beats losing money.

A last caution: Don’t go chasing trading systems that are slickly marketed to get you in and out of the market with their foolproof custom indicators – claiming that new students are making thousands of dollars everyday. I have seen more and more of these systems marketed lately. They usually come in a cleverly worded email offering a free session which is a sales pitch. There is no holy grail indicator for trading! The emails that I have been seeing promoting such systems tend to have a South African address at the bottom. Be very careful not to get lured into thinking that you can purchase a trading system and quickly make thousands each day. I would suggest that you are much more likely to lose your money.

Good luck with your trading and enjoy your weekend!

A quiet Monday with little economic news to drive price. The USDCAD made a brief move higher as North American traders began their day. Price then reversed lower following a bearish engulfing candle. A short was taken risking 14 pips for a potential 40 pips to our daily target at 1.2674. Price dropped through its Asian session low and continued to our target where we exited the trade.

The economic calendar is fairly light until Thursday. Trading hopefully will be less volatile.

Good luck!

After the U.S. traders got underway today, the USDCAD made a lower high which was followed by a double top and reversal pattern… closing beneath 1.2750. A short was taken risking 19 pips for a potential 78 pips to our daily target at 1.2670.

Price moved lower going into the European close, then pulled back to retest its Asian session low before descending further to the 1.2700 figure. Unfortunately today it was not convenient to watch the trade past the U.K. close, so we exited.

China will be off this week for Chinese New Year celebrations – which will reduce volume in the Asian sessions. There will be numerous important economic news events tomorrow as February begins. Be careful trading near the releases.

Good luck with your trading!

Canada’s economic releases today came in below expectation. As the equity markets continued lower this week, the markets were in “risk off” sentiment… which tends to move flows to the JPY.

A short in the CADJPY was taken risking 10 pips for a potential 22 pips to our daily target at 90.56. The entry looked like the second drive of a “three drives pattern”. This is usually, but not always, the largest of the three waves. Price made its way lower and the trade was closed at our target.

The up and down volatility is making for trickier than usual trading. If you are up 20+ pips, be careful not to give them back. Removing risk from a trade works well as does locking in profits as your trade moves in the direction of your target. Never let your position go negative if you’re up by 20+ pips.

Good luck with your trading and enjoy your weekend!

The CADJPY began the U.K. session moving higher before ranging for three hours going into the U.S. session overlap. Price attempted to push higher briefly, but was unable to close above its Asian high and formed three bearish hammer candles.

A short was taken risking 10 pips for a potential 57 pips to our daily target at 91.18. Price moved lower completing a mountain-like pattern just after the European close then began to retrace upward and closed our trade.

January has been a choppy month for trading and I will continue to post trades which resulted in greater than 20 pip moves. Thursday’s economic releases will be important for both the E.U. and U.S. Be careful trading around them.

Good luck with your trading!

As the EURUSD closed above 1.1335 today, a long was taken requiring an 8 pip stop loss for a potential 38 pips to our daily target at 1.1375.

The first area to get through was the 1.1350 level which price did with ease as the USD exchange rate weakened amongst the major currencies.

The next upside level to test was Friday’s high at approximately 1.1364 and price struggled to move higher… as we approached the U.K. close today. As price came back to retest this level our trade was closed.

Core CPI releases tomorrow for the U.S. will be closely watched.

Good luck with your trading!