BarroMetrics Views: There’s Always A Market
One of the important lessons I learned from Pete Steidlmayer is to be aware of the market structure of the instruments I am trading, and to be aware of any ‘unexpected events’. These he defined as events that change the underlying fundamentals and generally their happening tend to pass unnoticed by the majority of traders.
One such event was Abe’s public announcement to pursue Yen weakness. The effect of the announcement was dramatic. Take the AUDJPY, we see a sideways structure that began in April 2010. As soon as Abe’s announcement filtered into the market, we saw the beginning of a directional move that is still in play.
I prefer to trade directional moves, so identifying when a change in fundamentals will produce one is important to me.
Now normally I’d trade the AUDUSD pair. But, in this case……well, I’ll let you decide, compare Figure 1 with Figure 2. Which pair would you like to be trading?
FIGURE AUDJPY Monthly
FIGURE 2 AUDUSD Monthly