WARNING: This text is a word-for-word transcription of Mac’s daily forex trading video. That means the writing will reflect the way he speaks, if anything seems out of place, please refer to the forex video on the page.
OK, everybody. If my voice sounds a little bit strained, it’s because I think I’ve been talking for about three hours straight. I met a new friend of mine, Jeff. He and I were talking about, initially, options, but then I got kind of excited and all fired up and I think I wound up monopolizing the conversation. Big shocker there. Anyway, Jeff, if you’re listening to this, I apologize for monopolizing the conversation.
And so my voice is a little bit strained, so if I sound like I’m shouting, it’s because I’m really straining to hopefully be loud enough to be heard.
Today we had a very good opportunity to trade on the triple top as the market was breaking through this 5330 area. We had a very good pause right before the market broke through resistance. The reason why this pause is a good indication of a viable trade is that if the market goes sideways like this and it breaks through, what happens is we know everybody that sold in this area is going to have to get out.
So what we’re talking about here ‑ remember, we want to be consistent. We want to develop consistency in trading, right? We don’t just want to make money here and there, we want consistent money. We’ve got to realize that in order to capitalize on the market’s movements, somebody else needs to come in the market and move price in our direction. Some of the best people to do that are folks that are losing.
I know that sounds predatory and almost terrible, but that’s how the markets work. You’ve got some people that were trading in here and they were saying, “The pound is going to go down. It’s at a triple top. There’s no way it’s going to break through.” And then lo and behold, boom, the market accelerates upwards, which means all of these guys in here have got to get out.
And they’re going to get out eventually at any price. Why? Because they’re losing money. It’s critical that you understand that. So again, part ‑ I shouldn’t say part. A large component of you getting consistent with your training is understanding that someone else needs to do something in the market for you to make money.
Now, coming into tomorrow’s trading, what were we talking about yesterday? We’ve been talking about this daily formation here. We’ve got these prior highs. We have, overall, this bottoming pattern we’ve been talking about for months ‑ literally, folks, months. I mean, look at this. We started back in December. I can’t believe it’s been that long. So one, two, three, four, five and a half months we’ve been talking about this bottoming process.
Remember, I said bottoms are more complex. They take longer. Four, five, even six months is not unheard of. Here we go: working on six months of sideways action, but now we’re challenging these old highs. And so we are getting into the uptrend mode for the British Pound. I think what we’re going to see at the same time is the US equities market resuming its trend to the downside, by the way. So just to let you know, I think we’re getting set for another leg down in the US equities markets. Well, I’ll keep you updated on that. I’m not short, I am flat the equities markets.
Anyway, turning back to the British Pound, we’ve got to watch for breaks above our double top over here. Before we go into full‑blown trend mode, we need to see the little dipper. Remember, what that means is we need to see price break over these two highs and then come back down for a re‑test. That is going to be a re‑test of these highs and these highs. It’s going to be a pretty big area. We will deal with that when we come to it.
For tomorrow’s trading, however, what we need to watch out for are breaks above our triple top right here, 5509. I don’t think we should be looking at that as an autopilot trade, because we do have some significant tops from back in December we need to watch out for. However, autopilot trade is going to be a break below the short over here, which is on the low of 5424. So if we break below 5424, a good autopilot trade, I think we’ve got to move, at the very least, back down to the 5300 area.
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