Stocks & Commodities V. 23:10 (64-70): Product Review: eASCTrend 6.0 AOE by David Penn

Stocks & Commodities V. 23:10 (64-70): Product Review: eASCTrend 6.0 AOE by David Penn

First, the good news. Anybody who has spent any time looking at price charts knows that some of the most lucid, beautiful trending markets can be found in the daily charts of currency pairs. If you don’t believe me, then take a look. Were you long for the great run in the euro back in the second half of 2004? How about getting short sterling during the summer of 2005? And I know I’m not the only one who noticed the USD/JPY in mid-summer 2005 and wondered whether any ride back down would be as bumpy (yet stalwart) as the ride up over the past several months.

It is little wonder that some of the traders—and trading systems—most commonly linked with trend trading have performed most admirably in the currency markets, be they George Soros or Paul Tudor Jones, John Henry or followers of the original Turtle Trading system. If the trend is your friend, then the foreign exchange market is the next best thing to that famous watering hole where “everybody knows your name.”

Now the bad news. The opportunities that a 24-hour market brings are the same ones such a market takes away. Unlike most other financial markets— at least as far as the average retail trader is concerned—the forex market never rests. Sure, volume will trail off from time to time at different hours of the day (again, that’s a 24-hour day), but at any given moment, in Sydney, Tokyo, Zurich, London, Chicago, or San Francisco, traders are looking for angles to exploit —and round-the-clock market access plays a big role in uncovering those angles and soft patches where savvy traders can establish lower-risk positions and let the traders just waking up in the next time zone do all the heavy lifting of moving those positions forward.