Fresh start of the new quarter with short $AUDUSD and $EURUSD

The return on investment for Q1 was 7.5%. It is slower than the last quarter, but I am not competing with others or even me in the past, and I do not want to change my trading style in terms of strategy and trading span. Considering my life style, this is where I can be confident, comfortable and healthy, and that is the most important for sustaining growth. I will make more money when market gives opportunities, and when it does not, I will try to defend my capital rather than making money. That is all.

EURUSD struggled to claw up to the trend line resistance as I had anticipated, though the wave was a bit more complex than a zigzag. On Friday, it started a to-be-impulsive wave down. I will wait for the rebound to purple .2, and sell at the break of the short term trend line support that will be formed along the course of purple .2.

20100402-eurusd-daily

Update: The wave count for AUDUSD below is no longer valid.

For AUDUSD, I am operating on the first of the two scenarios that I wrote a week ago. I do not go into details, but even for the second scenario, in which AUDUSD eventually goes higher than 0.9407, this week’s move will most likely to the south (i.e. Aussie negative). Besides, if you look at the chart, the wave from purple .B to .C seems to be an ending diagonal which is often a reversal sign. And if you are still not convinced, I would say that the trend line resistance is right at the corner (0.9225). I think they are enough reason for me to sell $AUDUSD upon the clear break of 0.9175.

If the first scenario holds, AUDUSD will crash at least to 0.8975. And stop loss line will be around 0.9230. 200pips potential profit over 60~70pips potential loss. That sounds really good. I will wait for a a 6 hours or so before I actually set the entry order, but my ball park will be: Stop sell at 0.9165 for the entry, and 0.9230 stop loss if filed.

20100402-audusd-daily

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Current risk exposure:

"","","","","$29,058.30","","","","","","","","","","","","","","","","","","","","41.95%","","","2.00%","","","","","","","","","","","","","","","","","","","","","","","","","","","",""
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

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Total returns

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(Aug 10, 2009)
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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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