Trading for Amerrica

[murrica]

I am interested to see how Gold behaves around this price level. Are we threatening to break down here? Or is this support going to hold?

In any case, maybe this is a monster setup? It would be nice not to miss the gorilla in the room.

Popcorn and 3d glasses ready. Locked in, previews ending, cellphone off.

 

[murrica]

30 yr:

I hate this setup. The large bear rising wedge broke -- I had been watching this forever and everyone and their mama knew we topped back in August. I remember jogging with my girlfriend past the downtown area of our city, telling her on almost the exact day, "You just watch, interest rates have bottomed out here." One could easily just look at the charts on Yahoo Finance to ascertain this simple info.

So, I hate this setup because I want the interest rates to tick back down, for the purpose of a refinance that is not yet at the loan lock phase.. in addition to knowing it is a counter trend idea against the big daddy rising wedge that has already broken. Ideally, we would retrace and retest 148 on the 30 year before heading back down. Stop below that bottom line of the mini falling wedge, this provides a favorable R:R. I am not taking this trade, only observing at this time.

 

[murrica]

Coffee:

Here's another one I hate and I'll tell you why. The words 'limit down' scare the living bejesus out of me. And, that sound that a Keurig coffee maker makes when it starts brewing sounds like a frelling game show sound effect when the contestant loses. Except in futures trading, the losses are very real, and are not just hypothetical gains that could have been attained on a game show.

However, the trend line looks super clean. Buy here and a bit lower, stop below 130. I am not sure that I would ever place a real trade on frellin' coffee... not on any kind of leverage, anyway.

 

[murrica]

It seems the support trendline on Gold weekly is even cleaner than expected, after looking at the weekly 5 year chart.

It is going to break down here? Target would be 1,400 if breakdown occurs in earnest.

 

[murrica]

For Gold, looking at today's intraday price action (Feb. 14, 2013), it looks like there is some ugly battle happening around this support area.

Russell 2000 futures:

We hit the upper channel line, predictably. My original intention upon spotting this a few days back was to 'sit in my hands and wait'.. then later I modified my analysis using the candlesticks, incorrectly. This has happened to me in the past, and is likely related to a lack of patience. I am glad that I am documenting these thoughts in real time.

920.0 - 925.0 would be yet another place to attempt to short. Stop loss not far above, good risk:reward.

The other thing I am revealing through this journal is how I am constantly trying to counter-trend trade, even though I saw the Russell broke major multi-year resistance when the mini broke above 885. Fighting the trend seems to be my modus operandi and has impeded my chances for success in the past. I believe this has something to do with a perfectionist attitude, being unwilling or unable to enter into a trend after it has already started, for fear of getting retraced/stopped out.

My intention for this journal was to focus on the trade ideas, but as it turns out I will likely be also writing down thoughts related to discretionary trading, in an effort to improve my technique/execution/consistency.

 

[murrica]

Quote from murrica:

30 yr:

I hate this setup. The large bear rising wedge broke -- I had been watching this forever and everyone and their mama knew we topped back in August. I remember jogging with my girlfriend past the downtown area of our city, telling her on almost the exact day, "You just watch, interest rates have bottomed out here." One could easily just look at the charts on Yahoo Finance to ascertain this simple info.

So, I hate this setup because I want the interest rates to tick back down, for the purpose of a refinance that is not yet at the loan lock phase.. in addition to knowing it is a counter trend idea against the big daddy rising wedge that has already broken. Ideally, we would retrace and retest 148 on the 30 year before heading back down. Stop below that bottom line of the mini falling wedge, this provides a favorable R:R. I am not taking this trade, only observing at this time.

148 hit.

New chart on the short term:

 

[murrica]

Some thoughts for myself:

Regarding the 30 Year: While we did reach 148 as anticipated (amazingly with a large degree of accuracy..), my original call had the stop too tight, as we approached 140.x back in early March. I failed to followup to the post in between then. I did not place this trade, but had I done so I likely would have placed my stop slightly above 140.0.

While I realize that the shakeouts happen and are the nature of the markets, I still hate to let a winning trade turn into a losing trade. Being a directional trader with relatively shallow pockets and never adding to losers is a tough game. Not getting shaken out basically necessitates either having wide stops coupled with small position sizing, or being very sniper-like on the entries.

My goal overall is to identify longer term swing trades. With this strategy (sniper-like entries that begin on a short-term basis), I will be able to put on a full-size position and realize outsized returns.

 

[murrica]

Japanese Yen:

I realize this will not be a popular view. Yes, it is countertrend. Yes, it is insane to try to fight this ridiculous one-way trend. But, from these levels, long futures (short USDJPY) could be something to *try*. Carefully.

However if you do 'get lucky' on a long Yen futures here, the reward should be decent. I still have a target of 1.12 or so (would need to fine tune) on a *very long term* trendline retest. (See Fading Yen thread).