At the Top for the Drop

Observations: Late last week the USD weakened considerably with extreme volitility due to the credit crunch, the commodity and Euro currencies benefited in dramatic way. With some resolution and eventual intervention by the US govt, I see a correction coming back to the downtrend, and a strengthening US dollar.

The fall may not be as quick, but I see an upside to the British pound unlikely, so at this point I'm short near the 1.8500 handle. I could possibly have my wave count wrong. Lets see how it plays out, remember can't be accused here of 'Hard right edge' :)

Sept 10-11 Short at the 38

• Shorted at the 38% level with stop just above the 50%
• Entered at the breakout and first bear candle around 107.58 exited @ 107.07 for a +51 pips gain.
• The USD/JPY has been on a downtrend. The only USD major that has been weak, while Euro and Pound have been on a freefall. Most of the commodity currencies have been pumelled by the Dollar.
• Was not the best pair to trade, but trend was read correctly & confirmed by price action and fibs.
• There is further downside to this pair, but will avoid buying.
• Will possibly sell the next rally again if risk is right and can pick up a tight stop.

Market News Weekend Trade Gap

• Shorted Euro again after upward weekend price gap.
• During Asian trading, wasn't certain if the move upwards could be sustained so waited to see whether the trendline could be broken during European open.
• Bull candle was engulfed by huge Bear candle at Euro open.
• Gap that was key support area was also taken out.
• This trade was down as much as -80, however stayed with trade and let trend turn it into a winner +120 pips.