<strong> </strong>
<ol>
	<li><span style="font-size: 14pt;"><strong> INTRODUCTION:</strong></span></li>
</ol>
I had a great trading week, only one loss making trade, plenty of $$$ and pips plus I have my trading plan, aka PLAN A, in position as always.

Last week’s main piece in the blog when I talked about Draghi either putting up or resigning created quite a few comments, and, they were equally split 50-50 on whether he should stay or he should go. You can now just imagine the next ECB Press Conference…the scene is set…dry ice and Mario Draghi enters to The Clash pumping out “Should I stay or should I go”. OK… maybe not.

We have the ECB Bank stress results being published on Sunday 26<sup>th</sup> October (tomorrow). By the time this blog is posted to the website, there will no doubt be rumour and counter-rumour about the results leaked to the press and the numerous European TV stations. I think the main takeaway from this round of European stress tests is that some banks will have to fail, if it is just to see the ECB receive some credibility. Previous stress tests have been in a word lame.

Looking forward, the FED statement and NZD interest rate announcement and RBNZ rate statement are the two news items that stand out, in my opinion.

I feel turbulence in the markets on the horizon and the FED moves will be very influential on how the end of the year plays out. If it is not the way I want… then PLAN B will be rolled out immediately.

<strong> </strong>
<ol start="2">
	<li><strong><span style="font-size: 14pt;"> THE PREMIUM SERVICE: </span>

</strong></li>
</ol>
<p style="text-align: center;"><span style="font-size: 12pt;"><strong>OVERVIEW, TRADING ACTIVITY, NEWS UPDATE &amp; MONTHLY AND
</strong><strong>YEAR TO DATE TRADING SUMMARIES:</strong></span></p>
<span style="text-decoration: underline;">2.1 OVERVIEW:</span>

For new readers who may not be aware, I refer to the PREMIUM SERVICE quite a lot in this blog and for more details about what it is, and, how much it costs, you will need to go the welcome page of <a href="http://www.weeklyfxdrivethru.com">www.weeklyfxdrivethru.com</a> At the top of the page there are three drop down menus: PREMIUM SERVICE, SIGN-UP and DISCLAIMER. Further details and how to join are all contained there. You will need at PayPal account to subscribe.

<span style="text-decoration: underline;">2.2 TRADING ACTIVITY:</span>

I had an excellent week of trading. Only one loss producing trade and my core-position trades started to come back in line with my original direction. Last week I had 3 longer-term trades hedged; this week only 2. My maximum loss is limited to 170 pips. This is well within my RISK TOLERANCE level.

(Further details on HEDGING, RISK TOLERANCE and RISK MANAGEMENT can be found inside the PREMIUM SERVICE under TRADING ESSENTIALS)

There were some great directional trades in the past 5 days that I was able to take advantage of with some excellent multi-lot position sized trades.

My “PLAN A” trade plan is in play and subscribers to the PREMIUM SERVICE are aware of my aims/goals with this moving forward. I see many thousands of pips available if this plan plays out.

<span style="text-decoration: underline;">2.3 MONTHLY AND YEAR TO DATE TRADING SUMMARIES<strong>:</strong></span>

Below I show the up to date performances for my various trading styles. Full excel spreadsheets are in the subscriber area of the PREMIUM SERVICE website

Below are the excel spreadsheets covering this month so far and the year 2014 to date.

<a href="https://weeklyfxdrivethru.com/wp-content/uploads/2014/10/PREM-SERV-PROFITS1-25102014.png"><img class="aligncenter size-full wp-image-4626" src="https://weeklyfxdrivethru.com/wp-content/uploads/2014/10/PREM-SERV-PROFITS1-25102014.png" alt="PREM SERV PROFITS1 25102014" width="463" height="429" /></a>

<a href="https://weeklyfxdrivethru.com/wp-content/uploads/2014/10/PREM-SERV-PROFITS2-25102014.png"><img class="aligncenter size-full wp-image-4627" src="https://weeklyfxdrivethru.com/wp-content/uploads/2014/10/PREM-SERV-PROFITS2-25102014.png" alt="PREM SERV PROFITS2 25102014" width="463" height="427" /></a>

&nbsp;

<span style="text-decoration: underline;">PLEASE NOTE:</span>

The above examples in sections 2.2 and 2.3 are for illustration purposes only. The profitability examples detailed above are based solely upon single lot trading, regardless of lot type. If multiple lot sizes are traded the profitability margins will be different than those shown.

Just to provide more information so you understand where I am coming from with the risk / reward statements above. All of my trades are of different sizes and different size lot types. The above does not reflect the actual trading performance, but it does show you the direction of the performance of the trades placed. I like to add to trades, profits are taken as the trade progresses and my overall cost average moves several times. All of my trades are of different lot styles. I trade a mixture of micro lots, mini lots and standard lots across my brokers.

The above results simply display your profit or loss if you placed a single lot trade on all the set-ups suggested and did nothing else.

You must always remember to follow properly executed RISK MANAGEMENT and POSITION SIZING disciplines with all your trades and remember that Forex trading with a high degree of leverage can significantly increase your profits and losses. You should trade with a TRADE PLAN and NOT risk monies that you cannot afford to lose.

<strong> </strong>
<ol start="3">
	<li><span style="font-size: 14pt;"><strong> THE FUNDAMENTAL TRADERS OVERVIEW:</strong></span></li>
</ol>
<p style="text-align: center;"><strong><span style="font-size: 12pt;">THE FED IN CONTROL OF POLICY</span>
<span style="font-size: 12pt;"> whilst</span>
<span style="font-size: 12pt;"> THE ECB HOLDS A CAN IN WAITING</span>

</strong></p>
After two weeks of some great volatility in the Forex markets, we have now slowed just a little as traders look ahead on their calendars. Another FED event looms and as usual we seem to be driven by the vocabulary that will utilised in the press statement.

We have in my opinion two main factors that need to be addresses either by the FED or will be addressed as a result of FED action.
<ol>
	<li>The end of Quantitative Easing (QE). This should be confirmed.

If it is confirmed: I think that the USD will strengthen a little.

If it is delayed for whatever reason: There will be the rally beyond all rallies in the USD. The DXY will fall through support at 85.13.
(SEE CHART BELOW).

<a href="https://weeklyfxdrivethru.com/wp-content/uploads/2014/10/DXY-25102014.png"><img class="aligncenter size-large wp-image-4625" src="https://weeklyfxdrivethru.com/wp-content/uploads/2014/10/DXY-25102014-1024x569.png" alt="DXY 25102014" width="1024" height="569" /></a></li>
	<li>A commentary on when interest rates will be rising.

Recently, we have heard different FED members voice their opinions on the future interest rate policy of the FED. It is a mixed bag of delay or implement early 2015. Janet Yellen has tried to move away from specific economic data guidelines that were in place via her predecessor Ben Bernanke. She is a firm “Dove” in all her approaches and statements that she has made. Her language is one of “long after”…. Nothing will be immediate. If she continues to be dovish, one has to question the relevance of the U.S. economic data presented to us. If she doesn’t see it at positive…. why are the markets reacting to positive data?

Should the Fed release wording in the statement that pushes out the date of interest rate rises beyond the early expected 2015 date, the dollar will weaken. If the Fed also states that QE is NOT ending this month the markets will go wild. Does she want this? I think not.</li>
</ol>
On the flip side to the FED announcement is the reaction in the markets. But apart from the markets reaction, over the hours following the FED statement we should consider the reaction from the ECB.

Should the FED delay the end of QE and push out interest rate increases I think the ECB would go into meltdown, as the EUR/USD will be heading to 1.3000 again. Then we enter a battle of the central banks… the FED versus the ECB.

The ECB reaction would be very interesting indeed, Draghi has already appealed for governments to pull together and work with ECB policy to push for growth. The mere fact that he has to come out and state this says it all as far as I am concerned.

Draghi has no agreement with Germany over buying ABS and therefore is trying to have something for the next ECB meeting. Last week one ECB official came out and said it was unrealistic for the markets to expect some major initiative from the ECB at every press conference. The scene is being set and “the can” has been bought, they just need to decide what road to kick it down.

If the FED action results in USD weakness and the EUR jumps towards 1.3000, it would be a great long from present levels then short trade. However, it could spark a knee-jerk reaction from Berlin, who would, in many eyes be held responsible for the lack of activity so far in agreeing to loosen monetary policy to stimulate EUROZONE growth.

Let me just slow down a little…. A knee-jerk reaction from Berlin could be March 2015. They would send Draghi out to talk about it for a few months first, hoping that they would not need to do anything and that we would all have forgotten about it.

It will be an interesting Wednesday through to Friday next week and then we have the ECB press conference the week after.

&nbsp;
<ol start="4">
	<li><span style="font-size: 14pt;"><strong> TRADER TOPICS:</strong></span><strong> </strong></li>
</ol>
<p style="text-align: center;"><span style="font-size: 12pt;"><strong>IDEAS TO BATTLE UNCERTAINTY IN FOREX TRADING:</strong></span></p>
Without stating the obvious, Forex Trading is probably one of the most challenging markets to master. It is alive 24 hours a day and it can be very irrational at times. It can also be so unpredictable going from docile to volatile and back again in an instant.

Looking at the volatility and uncertainties that we as traders live with day in and day out we have to look at ways to deal with the volatile environment that we work within.

As the global economy faces the possibility of slowing down once again and as the political leaders struggle amongst each other to resolve geopolitical events, what can we do to prevent uncertainty from crippling us with fear

From my perspective after 7 years trading, battling uncertainty and getting beyond any fears that I may have requires two simple things:

<span style="text-decoration: underline;">ACCEPTANCE:</span>

Remember this quote “No matter how hard you work, you can still be wrong” (Ray Dalio Bridgewater Associates).

There is NO Holy Grail, perfect pill to trading.

If you have it in your mind that your analysis skills will be so good or that you’ll find that perfect mathematical formula to building a flawless trading record, guess again! The simple fact is that unless you can see into the future, you will not be able to predict every market move or your automated system (if you have one) won’t be able to factor in every imaginary variable. Yes, you will have losing trades and, if you cannot internalize the principle that no matter what you do you’ll never know everything that’s around the corner, then you will continue to be blind to what’s really going on and be unable to adapt to the ever changing conditions.

Everyone is different, so the catalyst for a paradigm shift to acceptance may come at different moments for each of us. But you can bet that it is usually doesn’t come until after a lot of trades and experience.

<span style="text-decoration: underline;">PREPARATION:</span>

The second step of reducing risk of the unknown is to be prepared. Serious business requires serious planning.

Trading is serious business. Whilst unpredictable factors will always be present, uncertainty can be significantly reduced through proper preparation. Taking time to study and control what you can (e.g. being aware of sentiment and upcoming news, considering all possible market reactions, controlling risk) reduces much of the uncertainty, because you have identified and planned for the “worst case” scenario. If you already know the outcome of your trade regardless if the market goes up, down or sideways, then how can you be afraid?

Acceptance and preparation sound like no-brainer solutions to overcoming the emotions created by facing the unknown, but of course, it’s easier said than done. The former may go against a belief system already deeply internalized in all of us: there is a logical reason for everything. Therefore we think “If I work hard and find the reasons that moved the market, I can use it as a competitive edge”. Please bear in mind, and I am sure that you have experienced this; the markets can be illogical and stay illogical longer than you can stay solvent, (Hence sometimes I hedge trades).

Preparation requires flat out work. You have to put in chart analysis time. You have to do a fair amount of economic reading. You obviously have to do a great deal of your system research and testing to be prepared for whatever the market will throw at you day in and day out.

If you achieve longevity in Forex Trading, experience will shadow uncertainty.

Just keep your head up when you take a hit, focus on probabilities in trading and the good habits you have and soon uncertainty will be something in the past.

<strong> </strong>
<ol start="5">
	<li><span style="font-size: 14pt;"><strong> MY CURRENT LIVE TRADES:</strong></span></li>
</ol>
&nbsp;

<strong>RADAR TRADES:</strong><strong> </strong>

There are no LIVE RADAR trades at the present time.

<strong>FLASH TRADES:</strong>

FT1190
NZD/USD
Short
Cost Average at: 0.7793
Stop at 0.7930
Limit at 0.6580
Present Price: 0.7845
Current Profit / Loss Position: -52 pips

FT202
USD/CAD
Long
Cost Average at: 1.1340
Stop at 1.1170
Limit at 1.1570
Present Price: 1.1230
Current Profit / Loss Position: -110 pips
(This trade is currently hedged from -70 pips)

FT209
AUD/USD
Short
Cost Average: 0.8785
Stop at: 0.8850
Limit at: 0.8000
Present Price: 0.8786
Current Profit / Loss Position: -1 pip

<strong>FUNDAMENTAL TRADES:</strong>

FUN44
GBP/NZD
Long
Cost Average at: 2.0507
Stop at 1.9500
Limit at 2.3200
Present Price: 2.0479
Current Profit / Loss Position: -28 pips

<strong> </strong><strong> </strong>
<ol start="6">
	<li><span style="font-size: 14pt;"><strong> TRADES THAT ARE ON MY RADAR:</strong></span></li>
</ol>
I have PLAN A in place and I think that I will be adding to core PLAN A trades only after the FED statement. In the interim I will be day trading and if those trades develop into swing trades all well and good.

I will NOT look at adding commodity cross-rates until after the FED.

None of the trades below are loaded with my brokers yet. The reasons are: -
<ol>
	<li>European Bank Stress Tests fallout.</li>
	<li>ISIS</li>
	<li>EBOLA</li>
</ol>
All of the trade suggested set-ups below are very simple straightforward probability trades based upon Fibonacci levels and horizontal support levels. As I have stated many times, trading is about identifying chart patterns and high probability trades. I use Fibonacci and pivot points for comfort most of the time as they do work.

EUR/USD
SHORT
ENTRY AT 1.2715
STOP AT 1.2765
LIMIT 1.2600

<strong> <a href="https://weeklyfxdrivethru.com/wp-content/uploads/2014/10/EURUSD-240M-25102014.png"><img class="aligncenter size-large wp-image-4619" src="https://weeklyfxdrivethru.com/wp-content/uploads/2014/10/EURUSD-240M-25102014-1024x518.png" alt="EURUSD 240M 25102014" width="1024" height="518" /></a></strong>

&nbsp;

GBP/USD
SHORT
ENTRY AT 1.6110
STOP AT 1.6190
LIMIT 1.5995

<a href="https://weeklyfxdrivethru.com/wp-content/uploads/2014/10/GBPUSD-240M-25102014.png"><img class="aligncenter size-large wp-image-4618" src="https://weeklyfxdrivethru.com/wp-content/uploads/2014/10/GBPUSD-240M-25102014-1024x518.png" alt="GBPUSD 240M 25102014" width="1024" height="518" /></a><a href="https://weeklyfxdrivethru.com/wp-content/uploads/2014/10/GBPUSD-240M-25102014.png">
</a>

&nbsp;

NZD/USD
SHORT
ENTRY AT 0.7880
STOP AT 0.7970
LIMIT 0.7790

<a href="https://weeklyfxdrivethru.com/wp-content/uploads/2014/10/NZDUSD-240M-25102014.png"><img class="aligncenter size-large wp-image-4617" src="https://weeklyfxdrivethru.com/wp-content/uploads/2014/10/NZDUSD-240M-25102014-1024x518.png" alt="NZDUSD 240M 25102014" width="1024" height="518" /></a>

&nbsp;

&nbsp;

USD/CHF
LONG
ENTRY FROM 0.9480
STOP AT 0.9430
LIMIT 0.9560

<strong> <a href="https://weeklyfxdrivethru.com/wp-content/uploads/2014/10/USDCHF-240M-25102014.png"><img class="aligncenter size-large wp-image-4616" src="https://weeklyfxdrivethru.com/wp-content/uploads/2014/10/USDCHF-240M-25102014-1024x518.png" alt="USDCHF 240M 25102014" width="1024" height="518" /></a></strong>

<strong> </strong><strong> </strong>

I will obviously add via twitter and THE DAILY FX POST additional trades as I see them<strong>.</strong>

<strong> </strong><strong> </strong>
<ol start="7">
	<li><span style="font-size: 14pt;"><strong> LOOKING FORWARD…THE KEY SUPPORT &amp; RESISTANCE LEVELS WITH THE USD MAJORS:</strong></span></li>
</ol>
<strong>EUR/USD: Closing Price 1.2670.</strong> We have seen a small drop in price in the past week. There are many news items ahead that will move price with this pair. Whilst the longer-term sentiment is bearish it will be a tough call on what to do with this pair in the short-term. My ultimate belief is that we are heading sub 1.2000, and, I believe that the FED will help the ECB achieve this through rate increases in the U.S. Support is very strong at 1.2600. I have this feeling we head higher first. There are so many great entry points higher for short trades back in the direction of the longer-term trend. Resistance is good at 1.2715 then 1.2765.

<strong>GBP/USD: Closing Price 1.6088</strong>. After all the shenanigans we end this week almost exactly where we closed the week before. I had a GBP/USD short trade last week and took a mere 20 pips profit from it. The cable was just not moving/acting correctly and I took the trade off the table… a good decision. We are range bound with this pair like so many others so it is set up for range trading for day traders. 1.6000 is great support and 1.6125 is good resistance.<strong> </strong>

<strong>AUD/USD: Closing Price 0.8786</strong>. I am confused by the price action with the Aussie. I was expecting a continuation of the fall in value. Instead, we have witnessed a false breakdown lower. I am not certain if this is the case but the price action has surprised me. Support is good at 0.8700 and resistance at 0.8850 and if broken will change my thoughts on how to approach these markets going forward.

<strong>NZD/USD: Closing Price 0.7845</strong>. The RBNZ must be pleased with the move lower in this currency pair. Also, during the week inflation data showed that there were no inflation concerns in the New Zealand economy therefore calls for further interest rate hikes should now be muted. Therefore, when Graeme Wheeler RBNZ Bank Governor releases his commentary to go with the interest rate decision this Wednesday, he has the ideal opportunity to state that the exchange rate is still too high and that he will continue to intervene in the currency markets. This should send the NZD/USD lower and my GBP/NZD higher…. if he does this he will be on my Christmas card list. Support for now is at 0.7795 and resistance is huge at 0.7995.

<strong>USD/CAD: Closing Price 1.1230.</strong> Why do I continue to trade the “Loonie?” I seem to have one great trade that blurs my vision and 4 bad trades to follow. I am currently long this pair but my trade is hedged to just a 70 pip loss. Personally, I want to see OIL at $70.00 a barrel very quickly. That would place this pair around 1.1600, I would make a ton of $$$... then I can close the trade. Unfortunately, it is struggling to move past 1.1250! I think that sentiment hasn’t changed despite the best efforts of Poloz, the governor at the BOC, who released a fairy tale last Wednesday aka the official BOC Monetary Policy Report. Support is at 1.1170 and resistance is 1.1300.

<strong>USD/CHF: Closing Price 0.9518</strong>. This pair is well supported at 0.9400. It has bounced off this level at least 4 times in the past two/three weeks. Support looking into the next few sessions is at 0.9480 and resistance at 0.9560.

<strong>USD/JPY: Closing Price 108.16. </strong>I am tired of looking at USD/JPY charts and trying to figure out what is the right thing to do… so I do nothing. We have moved up 100+ pips in the past week, but at the back of my mind I have this feeling that it will play the party line and rollover with equities when equities decide to correct properly; hence all my indecision. Looking forward I see 107.50 as good support and 108.65 as good resistance.

&nbsp;
<ol start="8">
	<li><span style="font-size: 14pt;"><strong> MAJOR TRADING PAIRS WITH LONGER-TERM TRENDS MATCHING:</strong></span></li>
</ol>
The following currency pairs have Short Term (DAILY), Medium Term (WEEKLY) and Long Term (MONTHLY) charts all trending in the same direction.

<span style="text-decoration: underline;">LONG:</span>

USD/CAD – why is it not motoring?
USD/JPY
GBP/CHF
AUD/NZD
USD/DKK
EUR/NOK
EUR/SEK

<span style="text-decoration: underline;">SHORT:</span>

NZD/USD
EUR/GBP
EUR/AUD
EUR/CHF
<ol start="9">
	<li><span style="font-size: 14pt;"><strong> MAJOR FOREX NEWS THIS WEEK THAT INTERESTS ME:</strong></span><strong> </strong></li>
</ol>
SUNDAY: EUR – European Bank Stress Tests.

MONDAY: EUR – German IFO Business Climate.

TUESDAY: USD – Core Durable Goods.
TUESDAY: NZD – ANZ Business Confidence.

WEDNESDAY: USD – FOMC Statement and Fed Funds Rate
WEDNESDAY: NZD – Interest Rate and RBNZ Rate Statement.
WEDNESDAY: AUD – RBA Economic and Fiscal Outlook.

THURSDAY: EUR – German CPi.
THURSDAY: USD – GDP.
THURSDAY: AUD – PPi.

FRIDAY: EUR – CPI estimate.
FRIDAY: CAD - GDP.

<strong> </strong>

<strong> </strong><strong style="font-size: 14pt;">FINAL THOUGHTS:</strong>

This is a big week for us.

Personally my PLAN A will be under scrutiny if the FED weakens the USD beyond the point of no return. Right now there is trend line support at 85.13 on the DXY, there is some leeway in my number but 84.75 on the DXY and I will be on PLAN B. My hope if that I can get long the USD across the board at 85.13 on the DXY.

My plan A aside, the FED FOMC statement, ECB Bank Stress Results, ECB - QE with it’s on or off leaks, rumours and denials that go hand in hand with EUROZONE normal business gives us enough to send the USD to hell or heaven within minutes.

Therefore, my suggestion is to trade smaller position sizes so as to avoid being caught the wrong side of a trade and incur big losses.

Is the market still directional?

In the near future I believe that it will be, but for now we are consolidating. If the FED really moves the market one-way or the other, with a very one-sided statement, that could change. There are overriding factors why the USD (DXY) should strengthen but that doesn’t mean that it has to.

From a trading perspective we should therefore, given the uncertainty and volatility, trade with smaller position sizes and wider stops.

Just remember; always use the RISK MANAGEMENT principles outlined in the PREMIUM SERVICE web site TRADING ESSENTIALS section to ensure that you do not over-stretch your Forex account. Longevity in the Forex market is only achieved through strong TRADING DISCIPLINES that include effective and strategic POSITION SIZING.

Good Luck.

Scott Pickering
The Pip Accumulator
Saturday October 25th 2014

EMAIL / FOLLOW ME AT:
premiumservice@weeklyfxdrivethru.com
Twitter: @pipaccumulator
Twitter: @ThePremService
Google+/scottpickering

<strong>DISCLAIMER:</strong>

FLASH, RADAR and FUNDAMENTAL trade set-ups, “Tweets” and “Trade ideas” that are posted in my blogs or on Twitter are trades and set-ups that interest me. They are provided for training and informational purposes only and should not be interpreted as an offer, solicitation or recommendation of any specific security or investment strategy. Past performance is not indicative of future results. Trading Forex carries a high level of risk, and may not be suitable for all investors. The high degree of leverage can work against you as well as for you. Before deciding to trade any such leveraged products you should carefully consider your investment objectives, level of experience, and risk appetite. The possibility exists that you could sustain a loss of some or all of your initial investment and therefore you should not invest money that you cannot afford to lose. You should be aware of all the risks associated with trading on margin, and seek advice from an independent financial adviser if you have any doubts.