Weekly Forex outlook 10 October 2016

Last week produced some big movement for GBP. Stories of traders and investors losing everything have been coming in from the online communities. Trading requires absolute discipline because just one moment of carelessness can undo months of profits or even wipe out all trading capital. I choose to be a survivor because I value the experience that the market gives me. I choose to stay alive so that I can take profits another day.

It has been more difficult for me to trade since Brexit because of uncertainty in support resistance levels. I am 3 months into my second year of prop trading and I have done 8 trades with only 1 winner. The Growth account is going through a new largest draw down, partly due to the losses and partly due to the increase in position size (as required by the firm I trade for). However, my performance statistic is still within the acceptable zone. Losses are kept small relative to winners. Both short term and long term expectancy are still positive.

Thursday last week provided 2 trading opportunities: EURYUSD H6 long at 1.1120 support and USDJPY H6 short at 104 resistance but I did not trade because it was too close to non farm payroll the following day. It hurts a little to find myself missing out on profits because I follow my trading rules. But then I also remember that my rules were created based on statistics and not emotions.

My focus for this week would be to identify new support resistance levels for GBP pairs. The only trading opportunity that I can see right now would be USDCAD on daily chart:

USDCAD - Buyers managed to break above 1.3250 long term resistance and closed above that. Today's open had a gap down so I will wait until Monday's daily candle to close before reviewing this pair again. I am looking for opportunities to go long above 1.3250 which could now be acting as support.