Hi Trades,

How to trade this would depend entirely on the individual. I myself prefer short-term trading and taking half off at counter-trend risk tolerance threshold levels, while some clients prefer to swing trade on a 4 hour or daily chart. The bottom line is first statistically proving the validity of the method/system so that one can focus on execution. Here is a chart of how I traded it – which is also our benchmark method. The same strategy would be used on any time frame. If after exiting half at 104.24 the market would have kept trading higher I would have had the option to manage the trade on a higher time frame chart.

Choosing which market to trade and which direction to trade it from is a mechanical decision for us based on market generated information only. Regardless of the seasonal I would be focused on buying dips in the Aussie until the patterns balance, or shift bearish.

What is most important is that the client keeps track of all the trades in a spreadsheet so they can see the validity of the method over time, and even more important see the importance of sticking to the trading plan which delivered those results.This needs to be done for many months before trading live. Most of the old floor traders I know no longer trade because they did not have the discipline to NOT listen to their wants and urges, nor had the patience to learn the value of mechanization. There is a lot to be said my brother for keeping an open mind and letting the market take you where it wants to go.

There is actaully a near identifal signal on this chart following the trade I took, however it was too close to the close to consider.

Trading involves risk of loss and is not suitable for most investors.