Tuesday, 26 April 2011

Anatomy of a Trade

I was at my desk, as usual, at just after 6 am London time with all four monitors loaded. I had Flo on and was watching the quiet Euro and ES futures going sideways.

At about 7am the Euro suddenly dived down a nice 17 tick move. I wasn't there. I immediately checked to make sure Flo was on as she didn't react. Yes, Flo was OK. It was so fast that I couldn't trade it manually and it didn't meet Flo's requirements. No trade for me. As the market was very quiet, I had clicked down to a 3 tick range bar.

Then just as quickly, the market retraced back to the EMAs. At about 7.24 am I suddenly found myself LONG the Euro. I HADN'T EVEN SEEN THE TRADE until it had triggered and alarmed. Within minutes, Flo had exited on the first scale and then exited on the next two scales. I had no real context to use except further above the market, so I left it all to Flo.

This is why I am Hybrid Trading.

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