HLHB Weekly Update – January 15, 2010

PoD Chart

So far, the crossover signals have been getting invalidated after I apply my 30-pip filter since the stochastics have already reached the overbought or oversold area by then. However, I noticed that, if I would check the EMA crossover and the stochastics first before applying the 30-pip filter, I probably would’ve gotten a bunch of trade signals by now. I realized that my original HLHB system was a little vague in terms of how to apply these indicators so I’ll be making some clarifications.

  • After the 10 EMA crosses the 20 EMA, check whether stochastics is overdone or not.
  • b.) If stochastics is not yet overbought or oversold, set an order 30-pips above or below the cross-over candle.
  • c.) Close the open order if it doesn’t get triggered when the candle after the crossover candle closes.

I’ll start applying these modifications by next week and hopefully I’ll get more trade signals (and pips!) starting then.

This week was a little disappointing as I wasn’t able to take advantage to get any trades in. I saw Big Pippin’s chart art and saw that I missed out on a couple of nice opportunities to short the USDCAD. Also, I missed out on my EURUSD trade because of a few pips. As one of my readers pointed out, I could have entered at market and would have had a profitable trade. As of now, I’m not too comfortable buying at market because I’m scared it’ll make me too compulsive. This is one aspect of my trading that I need to work on.

Last week, the NFP report came out worse than expected. Yesterday, retail sales figures were also disappointing. If inflation and confidence surveys come in below expectations later, could this set the stage for a bearish tone at the next FOMC meeting?

That could be something to watch out for in the coming weeks. Until then, I’m signing off! Time to go watch Sherlock this weekend! No spoilers please!