HLHB Weekly Update – May 7, 2010

Well, whad’ya know… It looks like I won’t be doing some modifications on the HLHB system just yet! Earlier this week, I received a nice little sell signal when all of my indicators lined up. The slow moving 20 SMA crossed over the fast moving 10 SMA while stochastics wasn’t in the oversold territory. The candlestick following the crossover went beyond my 30-pip filter, allowing me to sell.

PoD Chart

Lo and behold, the pair fell soon after I entered, hitting my first target of 150-pips. As the rules of my HLHB system stated, I put a trailing stop of 150-pips on my second position. Here’s what happened:

1.) Shorted two positions at 1.3195, with total risk of 1%
2.) Set stop at 1.3264, which is 69 pips away
3.) First profit target hit at 1.3045
4.) Trailing stop of 150 pips on second position
5.) Trailing stop hit at 1.2672

Total Gain: +673 pips / 4.88%

It looks like I have completely regained all my losses on this system – and then some – in just one trade. I love it! By the way, if you’re unfamiliar with my mechanical system, just head on over to my very first HLHB system post. In there, I describe the philosophy behind the system as well as a detailed explanation of the rules.

Looking back on this week, it’s pretty safe to say that it was dominated by developments out of Europe. After gapping up to start the week, the EURUSD just kept falling. Just look at that chart – it’s just a bunch of red candles! Talk about feeling the summer heat!

I’ve been reading up, and it just seems to me that traders look at the euro zone like it’s a scary movie and waiting for Freddy Kruger to just pop outta nowhere. You could even make a movie out of it and call it a “Nightmare on Eurozone Street! – Ha! Maybe they could even get Mr. Jean-Claude Trichet to play the role of Freddy… I see the resemblance…

Kidding aside, things are looking bleak in the euro zone right now. Everyone seems to think that Greece’s debt problems will lead to problems to other euro zone countries like Portugal and Spain. Furthermore, Trichet didn’t give any indication that the ECB would expand quantitative easing measures by buying more government bonds. This caused the EURUSD to fall for the fourth consecutive day…

And then yesterday happened! For some strange reason, we saw some CRAZY moves during the US session, when stock prices dropped like rain in Seattle! Apparently, someone at a big time bank sang off tune yesterday, accidentally inputting a wrong trade. This triggered some electronic trading glitches and wow, the results were nearly catastrophic! At one point, Mr. Dow Jones was swimming 1,000 points lower!

Combining this with all the tension that had been building up, this led to a mad sell-off in higher-yielding currencies, with the USD and JPY squashing all other currencies. The bright side to all this is that my HLHB system ROCKED. Can you say trade of the year?!

Check out my other trades and updates on MeetPips.com!

  • Helltopia

    Killer trade, congrats on the PiPs!
    Enjoy the weekend with a cold and refreshing one! :)

  • Helltopia

    Killer trade, congrats on the PiPs!
    Enjoy the weekend with a cold and refreshing one! :)

  • Huck

    Thanks Helltopia. I had an awesome weekend and I hope you did too!

  • Huck

    Thanks Helltopia. I had an awesome weekend and I hope you did too!

  • pimpit

    SMA OR EMA?

  • pimpit

    SMA OR EMA?