Over the last couple months, the Eurozone turmoil has dominated every market in the world. This has made it difficult for traders to determine what move to make next. The markets have shown mostly choppy cycles that have seemed to last weeks as everyone waits to see what will unfold next in EU. That, coupled with the time of year, forces us as traders to make a determination of turning risk on and off (risk off means not trading). In this sort of scenario, I’m a large propenent of dialing back risk or going completely risk off. Conserving equity is a key component of trading and limiting market exposure for my investors is important if there is any uncertainty.
In my trading, I will most likely look to trade at a reduced risk through December 16 and then not trade again until the second or third week of January due to holiday periods. So many traders and institutions take this time off, and the markets will be trading on lower volume which can make trading conditions even more difficult than ‘normal’. Sometimes this is difficult for traders and investors to “sit on the sidelines”, but there is no reason to chase a market that is going to be on low volume and there will be plenty of trading opportunities in 2012 and the years to come. As a professional trader, I’m in this for the long haul, so a big picture point of view is always the way I try and see things.
Be sure to read the full risk disclosure before trading Forex. Please note that Forex trading involves significant risk of loss. It is not suitable for all investors and you should make sure you understand the risks involved before trading. Performance, strategies and charts shown are not necessarily predictive of any particular result. And, as always, past performance is no indication of future results. Investor returns may vary from Trade Leader returns based on slippage, fees, broker spreads, volatility or other market conditions.