A Trade A Day

Kind of a quiet day on the Dow. Volume was light and the index was basically flat. This kind of action is expected. If the market acts like a rubberband, then yesterday was the snap and now we’re sitting waiting for a launch in the other direction. I’m not convinced the move upward will be meaningful. I think we have one more quick down leg. I would expect a slow retracement of price upward, and then a break downward. Of course this is all speculation on my part. We could get a major move upward with heavy volume and a restart of a short term uptrend.

As always I’ll let price and volume be my guide, but it’s fun to try to predict. I’m out for the time being. I know alot of money has been made on this short term down trend, but I have my rules. I’m finishing my watchlist for next week.

I’ve also started to look more closely at the forex market. I ‘ve never traded it, but it has always intrigued me. The only thing that bothers me who is taking the other side of your trade. You’re not trading on the actual interbank market so your liquidity is limited to who? The forex broker? Other traders? I can’t imagine a forex broker could last that long if they have consistently winning customers. And if everyone is a net loser liquidity would dry up without a net influx of new money.

Anyway, thoughts on the subject of forex are appreciated. My core trading strategies will always center around stocks, but if you are a real trader then the instrument shouldn’t matter. Give me liquidity, give me price movement and a moving average and I can trade.

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