Was Tuesday's bull pop just a one day wonder? We're about to find out trader buddies. The catalyst for Wednesday's swoon of course was Bernacke's gloomy comments that hit the markets like a surface to air missile. Tuesday evening Don Worden had proclaimed the day's action a classic one-day-reversal portending bullish things to come. Wednesday's night comment referred to it as a "fluke", with the odds now favoring the bears. Go figure.
Some readers have questioned my recent focus on currencies more so than stocks/ETFs and my response to that is that although I'm old I'm adaptive and follow the path of least resistance and greatest clarity.
For those that have followed the BZB Currency Rotator you may have noticed that the model's # 1 rank was correctly positioned 45 days in a row February to March. There's been a few stumbles along the way but from a risk management standpoint I'm finding currencies more technically consistent that equities and easier to forecast.
On Monday's close Project Z generated a BUY signal on UUP and a SELL signal on FXE. I prefer to run these 2 studies separately rather than as a pair trade just to see if the divergent signals confirm one another and I don't enter the trades intraday if price is moving against me. As a result I entered the trades late at Tuesday's close as the signals fired again. So far so good . . with 6 days to a fixed bar exit unless that 1/3 ATR stop fires on either position.