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Robert Edwards
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Contrarian daytrading technician who specializes in micro scalping of stocks (using 1 minute bar charts), swing trading of stocks overnight, weekly stock option premium selling, pre-market and post-market psuedo market maker and stealth trading activity, and selling commodity option strangles... More
  • Where Is The Australian Dollar Going Next Week? 2 comments
    Jul 6, 2013 8:06 PM | about stocks: FXA

    The Australian Dollar is in a bottoming process which should continue next week. In my last article that you can find here, I explained how the Sept. Aussie Dollar should seasonally rally from June 1st to July 26th according to Moore Research. I know it will be difficult to get the Aussie to rally all the way back up to turn a nearly $7,000 loser this year into a winner. But we should still rally over the next couple weeks and cut the loss on the seasonal trade down several thousand dollars. I bought again when the Aussie made new lows at 9050 and 9000 late last week and I was able to sell out at 9098 and 9125. After hitting a low of 9087 one expects a rally of 135 to 165 points and the move to 9134 before Friday's NFP (Non-farm payroll) report was a rally of 147 points off the low. I got completely out as I was afraid the payroll numbers would be strong and the Aussie would sell off. I was very happy to buy several dips following the report and eventually made over a dozen trades buying 9005 to 9015 and getting out 9018 to 9025. I remain long a few contracts over the weekend, based on the weekly chart that you will see below:

    (click to enlarge)Sept Aussie Weekly Chart

    Here is a weekly chart to look at:

    You will see from the above weekly chart, that we are down 8 of the last 9 weeks in the Sept. Aussie Dollar. Not only are we overdue for an up week, but if you went long the last several down week Fridays on the close, there was a significant rally to let you out the following week. Last Friday, June 28th, you would have bought in at 9107, and we rallied to 9200 this week to let you out before falling lower again. The week before that we closed on June 21nd at 9190, only to rally to 9289 the following week to let you out again, before falling lower. Even the strong Friday close of June 14th of 9537 let you out the following week at 9579, but of course you would have never gone long on the Friday of that strong rally week. Friday close on June 7th of 9434, let you out at 9593 the following week. Friday close on May31st of 9502, let you out the following week at 9719. In summary, buying on the last several down Fridays resulted in rallies the following week of 93, 99, 159, and 217 points counting backwards. You can see that the rallies are getting smaller and harder to come by. Like a coiled spring, one of these upcoming Fridays should result in a rally of 200, 300, or 400 points the following week. I am hopeful we make a marginal new low down to 89.50 or 89.00 (both points that I will be adding as they would be new low buy points) early next week. Then if we could get a rally back through 9150, the bottom will be in and we will have a temporary top in the dollar, so a big rally move to 9300 to 9400 could occur the following week, cutting the loss in the bullish seasonal that ends July 26th.

    A great site to check out is daytradingbias.com that you can click on here. Save it in your favorites list and look at it on the weekends to see the potential trading parameters of the following week.

    Stocks: FXA
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  • Robert Edwards
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    Author’s reply » Got out at 9090 on Monday 7/8/13 to 9099. Bought back too soon on evening break to 9037 but held for pop back above 9100, all the way to 9154 during night session. Falls back early Tuesday day session to 9095 where I could buy again, then rallies to 9154 again. Then falls back to 9089, letting me buy again, and now back above 9100. Crazy volatility. I feel one can buy in the 9095 area today and then on 50 cent selloffs on further dips below that. If the Sept. Aussie can close above 9150 then the bottom would be in for at least 9300 and maybe more.

     

    From the 9018 close on Friday, we have already rallied 136 points this week, so buying the close of a down week worked again, just as predicted in the article.
    9 Jul 2013, 11:07 AM Reply Like
  • Robert Edwards
    , contributor
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    Author’s reply » This was one of the wildest trading days I have seen in the Aussie Dollar. Soon after 9:00 p.m. Tuesday night, we hit low at 9081, where I bought 9098, then as I am sleeping we rally to 9190 but I happen to wake up in the 9170s and take profits. Then I buy a few times around 9155 to 9163 and make a few scalps, only to finally hang one contract 9157. Then we fall to 9110 where I make another group of scalps by buying 9115 to 9118 area and take profits 9126 to 9132. Then I hang one contract at 9118 when we fall to 9089. I buy additional contracts in the 9090s and hold a couple low priced contracts through the fed minutes report at 2:00 p.m. Then we rally to 9130 which lets me out of all contracts bought under 9100, along with the 9118 contract hung earlier. I then place a sell order at 9158 and miraculously we rally to 9159 which lets me out of the 9157 order I hung earlier. I am now flat. Then we fall back to 9118 where I hang a contract again, buy again 9090, only to see us fall to 9049. I make a few scalps from 9060 to 9080, and then we are around 9070 when Bernanke begins talking around 4:45 p.m. eastern time. We rally to 9135 and higher where I am able to blow out of all contracts but one around 9130. When the market reopens in the night session, I sell that last one at 9178, only to see us rally to 9207. On a break of 9207 to the upside I go long again and bail out shy of the 9258 top. We then proceed to fall back to 9161 so I buy back again 9170 just one contract and we are pushing 9180. What a crazy and volatile couple days and very profitable. I played things far from perfect but I managed to pull out some serious coin.
    10 Jul 2013, 08:53 PM Reply Like
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