For the rest of you that are either struggling to make any progress with trading or currently make use of this type of trading then please feel free to collaborate your thoughts, analysis, or anything related.
Let me start by saying I do not do this full-time and it's not because I am unable to but rather by choice. As much as I am involved with trading I am also involved in other commercial interests. That being said I do withdraw profit from trading to supplement my lifestyle. My capacity in this market is both long term and intraday. The long term trades exploit the long term trend that is predicated by economic data and is underpinned by central bank policy. My intraday approach is working in the framework of sentiment and economic data releases. Both long term and short term have overlapping pillars but the pairing of strong with weak doesn't necessarily agree with long term. It is to maintain a separation of concerns and I use separate accounts and risk profiles for each approach.
Tools that I use:
1) eikon (my primary real-time news terminal)
2) tradingeconomics.com (historical and current overview of economic data)
3) forexlive (analyst commentary)
4) central bank websites
5) marketwatch.com/optionscenter/calendar (option expiry)
markets I track
3) equities (high level)
economies I track
3) EU + top 5 in euro area
1) catch up news and Asia markets (1-2 hours)
2) - prep daily schedule (upcoming news for day and whats ahead for the week).
- Adjust any news feed filters to keep track of stories that can affect sentiment.
- Create list of strongest to weakest based on news and sentiment (goes side-by-side with long term list)
- Map list (trade list) with upcoming news and create new list of potential pairs to trade based on a strong or weak release
1) monitor sentiment and adjust trade list where applicable
1) catchup on notes (long term diary and any details i need to keep fresh)
1) research and update notes
You will not that there is a lot of time spent researching and taking notes. This is for good reason because i need to know where all the economies i trade are in their cycle, how sentiment is affecting the trend, and be prepared for the best opportunity. There is no point going into a data release and not knowing which currency i am going to pair this release with for the best opportunity for intraday trades. People that just blindly trade pairs without knowing why something is happening or the potential that opportunity presents (a few hours or a few days). Having this knowledge also increases the win rate and maximises the potential of each opportunity. How many times have you missed a move or exited to early or to late?
These trade can last anything from a few hours to a few sessions. Stops and targets are derived off the average daily range and trades are taken when sentiment changes or data is released with an unexpected number that is outside or on the upper or lower expected threshold (you don't get this data from free news services only premium offers it)
these trades can last weeks to months and the objective here is to have a payoff + swap in favour but this is not a deal breaker so long as the expected payoff and rollover differential doesn't diminish the opportunity. I like to catch changes in the cycle and take advantage of this on multiple trades that i peel off and re-enter until the cycle is completed or game changing data changes the long term trend
that's a very high level of what I do. Now feel free to share your process or discuss analysis and any ideas.