Importance of Specializing in one/few instruments vs Running after everything that moves
Most of you have seen on the net those video ads that show you a mobile phone in hands of a guy, sitting behind the wheel of Lamborghini , scrolling it up and down and showing numerous instruments being traded at the same time – yeah right…
I don’t want to insult anyone, but c’mon guys – don’t you know it better.
I have explained some basics on the risk management ( stop loss, trade size, R/R ) and if you paid just a bit of attention to it, you would know what kind of calamity comes your way if you open more than one position at the same time.
So I am not going to waste my ( and your ) time in going deeper into this.
What I am going to try to explain here is the Importance of Specializing in few Instruments.
To be able to successfully trade every single day, and to come up with positive results at the end of the road, you must know your enemy ( and yes, all these instruments are your enemies ).
Why is it so important when we use the same techniques, same charts, same strategies on all ?
Well, because every instrument has it’s own set of rules and the behaviour differs .
First of all, those differences are visible and levelled in the Crosses – so unless you want to follow every single one of them ( Crosses), 24/5 , you better concentrate on the main pair.
You can spot the behaviour of different pairs if you follow them on smaller time frames.
At first you might not see/understand what is so unique with any given pair, but after some serious time it will start coming back to you – first as a Hunch/Gut feeling ( your sub consciousness will recognize it) , and then you will slowly start to see it and use it.
Trading forex is not the same as trading Stocks or Metals for the example, and all those very old rules used in last hundred years and more are useless when it comes to currencies.
That old adage – Don’t put your eggs in the same basket might have some sense today if you are creating your 401K , but in Intraday trading it is just ridiculous.
If you open few positions at the same time, with different instruments you are on the road to lose on all of them.
Probability is not going in your favour – on contrary ( Murphy’s Law ) , and you are going to start looking like a crazed chicken running around.
You need to come to the point where you live, breathe, dream of and follow every step of the instrument you trade.
I am sorry if this is not what you expected from trading to be , and that making it big is a very difficult, long and tiresome process, but I am telling you what you have to do if you want to be successful in trading.
GBPUSD Daily
Supports : 1.31150 , 1.30550 & 1.30000
Resistances : 1.31550 , 1.31900 & 1.32450
Pretty clear situation , with two scenarios :
– 1.30550 holds it’s grounds – we’ll be turning Up
– 1.30550 taken out – we’ll be gunning for 1.28500
Close tonight is very important and might give us a clue on coming days.
I’ll post an update late tonight.
Sept 13 (Reuters) – A look at the day ahead in U.S. and global markets by Amanda Cooper.
What a difference a day makes. Just 24 hours ago, investors were coming to terms with the idea that a half-point rate cut next week from the Federal Reserve was unlikely and a quarter-point drop was much more in line with a soft-landing scenario.
A couple of articles by closely followed Fed correspondents in the Financial Times and the Wall Street Journal overnight, along with comments from influential former Fed official Bill Dudley, have been enough to flip those assumptions on their head. It’s now pretty much 50/50 as to whether the Fed goes 25 basis points or 50 on Sept. 18.
now this is more to my interest:
2-year Treasury yield slides as investors assess interest rate outlook
comedy relief at the FED
The Fed’s Rate-Cut Dilemma: Start Big or Small?
By Nick Timiraos, Sept. 12, 2024
That the Fed will cut rates at its meeting next week is all but settled. But how much is shaping up to be a close call.
Federal Reserve Chair Jerome Powell faces a difficult decision as the central bank prepares to cut interest rates next week: Start small or begin big?
EURUSD 4 HOUR CHART – FRIDAY THE 13TH
1.1091 nicked only so far but 1.11, midpoint of 1.10-1.12 is probably more important in dictating whether EURUSD makes a fresh run at the 1.1201 high.
On the upside, the key trendline (see chart) would need to be broken to expose 1.1155 as a target.
On the downside, keeps a bid as long as it trades above 1.1055.
Otherwise, it is Friday the 13th if you are superstitious.
XAUUSD – Gold
Supports : 2530.00 , 2500.00 & 2470.00
Resistances : 2590.00 , 2620.00 & 2730.00
If what we have seeing in last two months was a consolidation phase, this might be a start of the Rally.
Two levels come to mind in that case : 2750 & 2850
Mind you, market has no brains – I still remember Gold at 250 ( yes, didn’t miss a zero here – two hundred and fifty ), and at that time I had a problem calming down some big clients , forcing them to hold on their gold ( physical ) .
Now in this time of uncertainty , what better then Gold ?
Nasdaq 100 – NDX
Wall St mixed in choppy trade as PPI data keeps smaller rate cut in view
August producer prices slightly above estimates
Moderna tumbles after dour FY25 revenue forecast
Indexes: Dow down 0.13%, S&P 500 up 0.18%, Nasdaq up 0.43%
Wall Street’s main indexes were mixed in choppy trading on Thursday after higher-than-expected producer prices data kept a smaller 25-basis point rate cut by the Fed firmly on the table, while Moderna slumped following a downbeat revenue forecast.
S&P 500 – SPX
US Equity Indexes Rise as Market Prices in Gradual Monetary Policy Easing Following Hot Inflation Print
The S&P 500 index rose 0.7% to 5,590.2
The US Producer Price Index grew 0.2% month-over-month in August following a flat reading in July, the Bureau of Labor Statistics said Thursday, faster than the 0.1% gain expected in a survey compiled by Bloomberg. Excluding food and energy prices, core PPI climbed 0.3%, above the 0.2% gain expected and a 0.2% decline in the previous month.
On a year-over-year basis, PPI was up 1.7% in August versus a 2.1% growth in the previous month. However, the rate for PPI excluding only food and energy accelerated modestly to 2.4% from 2.3%, and the rate for PPI excluding food, energy, and trade services advanced to 3.3% from 3.2%.
Nvidia – NVDA
Nvidia’s stock extends gains: ‘The time to worry is clearly not now’
Nvidia Most Active Stock in S&P 500 and Nasdaq 100 So Far Today
Would be highest close since Aug. 28, 2024, when it closed at $125.61
Currently up five of the past six days
Currently up four consecutive days; up 16.76% over this period
Longest winning streak since Aug. 19, 2024, when it rose for six straight trading days
Best four-day stretch since the four days ending Aug. 15, 2024, when it rose 17.29%
Up 0.58% month-to-date
Up 142.44% year-to-date
Down 11.45% from its all-time closing high of $135.58 on June 18, 2024
Up 163.4% from 52 weeks ago (Sept. 14, 2023), when it closed at $45.58
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