A small profit with AUDUSD. Watching for the next opportunity.

Last week, I entered a AUDUSD short position during the FMOC meeting. After the announcement, AUDUSD went down until Friday morning. I carefully counted the wave, and decided that it was not going to be an impulse wave. Besides, the news on Friday before the bell was about the financial over-haul bill becoming clear. I expected shorts to cover their positions and that is AUDUSD positive. So, I exited first thing in the morning with 72 pips, and that was a correct decision. 0.32% gain to the capital.

Now I’m watching. I’m still holding on two both scenario that I had posted on June 16. The second scenario is favorable for the sellers, but I’d be careful. I will probably sell a small lot of AUDUSD along purple .B(.2) to blue underlined B.

Very cautious on short & mid term gold

As you know, I made some money with short term long trade on gold, and I also have a mid term long position that is slightly positive. But looking at May and June’s gold sluggish move, I started to get very cautious. Frankly, I will be exiting mid term position at the next opportunity. It may extend the rally, but I want to be on the safe side.

First, 360min chart. I provided two versions of Elliott wave counts labeled with/without parentheses:

In either case, the last few waves look very much like ending-diagonal unless there will be a sudden rally like a rocket within a few days. Today’s fall rather looked very impulsive downwards, making me even more cautious.

If we get longer perspective on daily chart, I can even count this is the very top of mid term bull (labels with parenthesis):

Again, the shape of the wave from purple (.IV) to (.V) looks non-impulsive.

I have no emotional attachment to this market. I will be soon out of gold trade for the time being!

It’s time to preserve the capital for me

It’s been 10 days since the last post, so I should post something.

Frankly, nothing to say but I’m capital preserving mode.

I was trying to figure out the Elliott wave count around May 6 flash crash. Below is my count of AUDUSD, May 6′s low being blue underlined 3. Although I did not upload, AUDJPY has almost the same count except that the blue underlined 5 is truncation for the JPY cross.

Now that black I is over for AUDUSD, it should be followed by A-B-C zigzag wave II. If I count with the labels with parentheses, the zigzag seems to be finishing already, but I prefer to take the primary scenario which is marked with labels without parentheses, because of the move of EURUSD:

I don’t think EURUSD’s rebound is over. I expect the risk appetite comes back some more weeks, and shorts will continue to be forced to cover. So, USD and JPY (and maybe gold too) to give back more. That is my view.

Real time trading tweets

The plan in the article may get rejected any time, so please check out my tweets on Twitter.

Current risk exposure:

Rational Move always use stop loss orders, and this is the worse case potential loss over the capital for the currently open positions. This is unrealized loss is less or equal to the risk exposure.

Capital growth

From recent 100 trades (%) The growth right before the 1st trade is set to 0%.
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From recent 100 trades (%)
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Total returns

Since inception
(Aug 10, 2009)
Year-to-date Quarter-to-date
0% 0% 0%
This is a normalized value: the return on each trade is normalized against the capital just before the trade execution. This way, it is eliminating the effect by the capital change from deposits and withdrawals. The calculation thus reflects the trading performance of each trade. The value does not contain unrealized profits and losses. RM's trading strategy never risks more than 5% of the present capital. Not including subtraction by tax.

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June 2010
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