1. GOLD (Daily Chart) – Ascending Triangle Breakout Short – 27.05.2014 – Having stagnated sideways for the majority of April and May, demand for stock of Gold had formed a classic symmetrical triangle pattern, with price working its way into the apex and getting close to a breakout. Traders were awaiting a break lower as triangles are most often broken in the direction of the preceding move which was short. Entries were placed safely under support, stops above resistance, and after a few days of waiting Monday provided the first clue of what was about to happen by posting a huge high test seller bar. This was duly followed through on Tuesday with sellers aggressively breaking the metal lower. The market continued to slide for the majority of the week, hitting +2% profit.
2. EURUSD (5Min Chart) – Pivot Trade Short 28.05.2014 – The weak EURO sentiment continued this week as the market still awaits the European Central Bank action next month. The daily chart however was heavily oversold so traders were more comfortable looking for shorter term moves on the lower timeframes. Several opportunities on the pivot presented themselves last week but it was Wednesday which provided the first positive reward to risk trade. There was only a single entry opportunity but it duly obliged by hitting a +1.20% target within a few hours.
3. USDCHF (5Min Chart) – Pivot Trade Long 28.05.2014 – On the daily chart price had broken key resistance and was moving strongly higher but just like the EUR, the currency market was heavily overbought and thus limited a decent profit potential. This is where traders, confident on the direction but not the reward potential, can drop down timeframes for more efficient entries. This was the case on Wednesday with several strong pivot trade setups, each hitting a +1.27% objective within the day.
4. NZDUSD (Daily Chart) – Breakout from Support 28.05.2014 – Price had formed a very clean horizontal level of support at the 0.8520 area which had been held since early March. During this time, price had formed what looked decidedly like a head and shoulders top and thus instigating the potential for a sharp reversal. Traders looking to aggressively enter this trade could have done so as soon as the level was broken, with a stop just above, keeping the risk tiny just in case of a false break. This didn’t occur, the market broke strongly lower and trades are comfortably up +2% with stops at breakeven and the potential for further profit if the market reaches its next big horizontal level at the 0.8400 level.
5. EURGBP (Daily Chart) – Power Pivot Trade Long 27.05.2014 – Price had fallen to the big round number of 0.8100, a key psychological number. Alongside this was some very clean stochastic divergence which highlighted a potential reversal was imminent. This argument for a long position was further established by a clean overextension on the Fibonacci and some strong bullish price action last Friday and Monday. The high of these bars was broken on Tuesday allowing forex traders a nice efficient entry, with a stop under the swing low. Trade has realised a +1.5% profit.