Swing Trading and Market Timing Knowledgebase

By: John Crane, swing trading guru

Trading Japanese Yen Trail

Figure # 6.31 - June Japanese yen traded to a new contract low on the May 13th swing trade date. The futures market had pushed below the prior pivot low from three days earlier and closed at the bottom of the daily trading range. The new low was below the Swing Trading Strategy TC pattern, therefore the trend was reaching maturity and should be losing momentum. Based on this knowledge, I was on the lookout for a major reversal at this juncture.

The trail day quickly confirmed what I suspected when the Japanese yen traded to a new low before it turned and closed above the opening price. The swing trade date had just signaled it was time for a reversal. The new low suggested the futures market was at the right price level for a possible reversal and the trail day pattern confirmed a directional change at the end of the trend and the beginning of a new bullish trend. Everything had come together and the futures market responded accordingly.

japanese yen trail
Figure # 6.31 – June 2004 Japanese Yen

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**THE RISK OF LOSS IN TRADING CAN BE SUBSTANTIAL. YOU SHOULD, THEREFORE, CAREFULLY CONSIDER WHETHER SUCH TRADING IS SUITABLE FOR YOU IN LIGHT OF YOUR FINANCIAL CONDITION. HYPOTHETICAL OR SIMULATED PERFORMANCE RESULTS HAVE CERTAIN INHERENT LIMITATIONS. UNLIKE AN ACTUAL PERFORMANCE RECORD, SIMULATED RESULTS DO NOT REPRESENT ACTUAL TRADING. ALSO, SINCE THE TRADES HAVE NOT ACTUALLY BEEN EXECUTED, THE RESULTS MAY HAVE UNDER OR OVER-COMPENSATED FOR THE IMPACT IF ANY, OF CERTAIN MARKET FACTORS, SUCH AS LACK OF LIQUIDITY. SIMULATED TRADING PROGRAMS IN GENERAL ARE ALSO SUBJECT TO THE FACT THAT THEY ARE DESIGNED WITH THE BENEFIT OF HINDSIGHT.NO REPRESENTATION IS BEING MADE THAT ANY ACCOUNT WILL OR IS LIKELY TO ACHIEVE PROFITS OR LOSSES.