Cross-Eyeing: EUR/JPY – Trade Closed

Trade Closed: 2009-03-31 07:13

My trade stopped out this morning as the Yen continued its sell off. Shortly after my trade idea posted, multiple news reports came out of Japan that scared traders away from the Yen. Not surprising was the weak data that continues to roll out, but the news that the government has yet to complete a stimulus package….geez!! That definitely was enough to scare most away from the Japanese Yen. So, the Yen has fallen out of favor again and needless to say, the potential resistance areas around 130.00 failed to hold as Yen sellers flooded the market.

Trade closed at 131.40

Total: -150 pips/ -1.0% loss

So, the quick changes in sentiment continue with every new news report that comes out. It’s choppy out there kids, so be safe and good luck!

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Trade Idea: 2009-03-30 21:04

crosseyed chart

Good Evening! I may have been a bit early on my short idea last time, but I think today’s retracement higher in EUR/JPY is giving me another opportunity to short again. Ch-ch-ch-check it!

It’s the usual chart setup, except on a shorter time frame than usual. We can see EUR/JPY on a short term downtrend on the one hour chart. We can see a retracement after hitting lows are 126.50, all the way back up to previous support and the 61% Fibonacci retracement area. Actually, as I write this, EUR/JPY just hit highs around 129.95. I’d like to short here for a short term play as I will probably take my trade off of the table ahead of the G-20 meeting this week and the ECB interest rate decisions.

Again, I am in the short anything Euro camp as I feel the recession along with their banking system issues will de-stabilize confidence in the euro further. I look for the ECB to stop the stubbornness and cut rates. We’ll see if they do or don’t this week, but I think traders will price it in ahead of the decision on Thursday. Here’s what I’m going to do:

Short EUR/JPY at market (129.90), stop at 131.40, pt1 at 128.40, pt2 at 126.50

Remember to never risk more than 1% of a trading account on any single trade. Adjust position sizes accordingly.

Stay tuned!

  • engin

    why do you chase this pair and why do you fight with trend??
    maybe you should check your stop loss because its first target 131.43 and 131.57

  • PipWolf

    I have to agree with engin here. Both you and Pipcrawler have recently had bad trades where you have repeated an earlier trade idea that failed. In both cases you switched to a shorter time period too. It’s like you were trying too hard to see a trade because you didn’t want to let go of the idea. You both do great when you stick to the 4hr chart. I don’t want to sound ungrateful because you have both taught me so much, but I got a bad vibe from this trade and got burned with you.

  • engin

    why do you chase this pair and why do you fight with trend??
    maybe you should check your stop loss because its first target 131.43 and 131.57

  • PipWolf

    I have to agree with engin here. Both you and Pipcrawler have recently had bad trades where you have repeated an earlier trade idea that failed. In both cases you switched to a shorter time period too. It’s like you were trying too hard to see a trade because you didn’t want to let go of the idea. You both do great when you stick to the 4hr chart. I don’t want to sound ungrateful because you have both taught me so much, but I got a bad vibe from this trade and got burned with you.

  • cyclopip

    Greetings guys and thanks for the comments! Based on fundamental research, both Pipcrawler and I feel the euro is going to get hit hard. That’s our view. Pipcrawler actually had a winning trade shorting EUR/USD. I was just early as EUR/JPY dropped 700 pips after hitting 134.00. That’s the problem when going with fundies is the timing. No one I know is perfect on picking tops and bottoms perfectly every time. If you know someone please let me know and I’ll give them all of my money to trade… hehe JK. Pipwolf, sorry to hear that you got burned. Again these blogs are intended for us just to share what we’re are doing and it is not investment advice! It’s up to you which position you take and how you play the markets. We put up our ideas as we see them and sometimes we get sideswiped by surprise news. Surprise events happens which is why we always promote proper risk management. I’m glad to hear we’ve taught someone and don’t mind the critism. We just hope that the lesson learned this time is in the end to take your own position, especially if you get a bad vibe. Hope this helps and I hope I can come up with better ideas to converse with ya’ll. Thanks again for the comments!

  • ndhoanggia

    @PipWolf: Trade what your chart tells you!!! You got burned, it was your fault. No one forced you to pull the trigger. Cyclopip or anyone could come up with trade ideas, however, if your chart does not scream out the same game plan then stay out!

  • pakiestra

    Hey Pipwolf, I feel for you, but on the other hand Mate you must be honest with yourself first. I don’t want just to bit the drum, but hey, do you know what is risk management ? If you thought that with one/two trades you gonna make thousands or hundred thousands and you risk too much, hey it’s a lesson you have to attend to become a professional.
    I know that common stuff on trading like money managment is repeated ad nauseam everywhere you look on but this is an essence Mate. When Im having 3 consecutive losses (rarely happens these days with the strategy I use) I close my trading station for a full 24 hrs, then opening it again absolutely oblivious of what happened to the market and trying to figure out my mistake, it works very well. I think (and somebody already mention that on forum) 80% of success is YOURSELF (this battle is the most difficult to win and some people have a stuborn mind so they won’t fight their ego) then 10% is charting and analysis and only 10% is fundamental reason for the trade. The sooner you will give up a thought that you can make living on Forex in one year the qucker you will start to make consistent profits, it works in a inverse/perverse correlation. Sorry for a ranting but this is to help you to stop losing your account. You will have to find your system and go through basic lessons and then you will be looking at our Admins’ pages only to compare with your own trade system rather then relying on them as absolute.

  • cyclopip

    Greetings guys and thanks for the comments! Based on fundamental research, both Pipcrawler and I feel the euro is going to get hit hard. That’s our view. Pipcrawler actually had a winning trade shorting EUR/USD. I was just early as EUR/JPY dropped 700 pips after hitting 134.00. That’s the problem when going with fundies is the timing. No one I know is perfect on picking tops and bottoms perfectly every time. If you know someone please let me know and I’ll give them all of my money to trade… hehe JK. Pipwolf, sorry to hear that you got burned. Again these blogs are intended for us just to share what we’re are doing and it is not investment advice! It’s up to you which position you take and how you play the markets. We put up our ideas as we see them and sometimes we get sideswiped by surprise news. Surprise events happens which is why we always promote proper risk management. I’m glad to hear we’ve taught someone and don’t mind the critism. We just hope that the lesson learned this time is in the end to take your own position, especially if you get a bad vibe. Hope this helps and I hope I can come up with better ideas to converse with ya’ll. Thanks again for the comments!

  • ndhoanggia

    @PipWolf: Trade what your chart tells you!!! You got burned, it was your fault. No one forced you to pull the trigger. Cyclopip or anyone could come up with trade ideas, however, if your chart does not scream out the same game plan then stay out!

  • PipWolf

    Okay all, I’m not saying that Cyclo burned me, I’m saying I burned me. I followed Cyclo’s trade (as I have followed all his and Pipcrawler’s trades for about the last year) even though I didn’t like it. I guess I was trying to say that I should have followed my own instincts to stay out of this trade instead of blindly trusting in Cyclo’s judgement. We’re ALL ultimately responsible for the trades we place, regardless of the sources of information we use to come to the decision to trade.

  • pakiestra

    Hey Pipwolf, I feel for you, but on the other hand Mate you must be honest with yourself first. I don’t want just to bit the drum, but hey, do you know what is risk management ? If you thought that with one/two trades you gonna make thousands or hundred thousands and you risk too much, hey it’s a lesson you have to attend to become a professional.
    I know that common stuff on trading like money managment is repeated ad nauseam everywhere you look on but this is an essence Mate. When Im having 3 consecutive losses (rarely happens these days with the strategy I use) I close my trading station for a full 24 hrs, then opening it again absolutely oblivious of what happened to the market and trying to figure out my mistake, it works very well. I think (and somebody already mention that on forum) 80% of success is YOURSELF (this battle is the most difficult to win and some people have a stuborn mind so they won’t fight their ego) then 10% is charting and analysis and only 10% is fundamental reason for the trade. The sooner you will give up a thought that you can make living on Forex in one year the qucker you will start to make consistent profits, it works in a inverse/perverse correlation. Sorry for a ranting but this is to help you to stop losing your account. You will have to find your system and go through basic lessons and then you will be looking at our Admins’ pages only to compare with your own trade system rather then relying on them as absolute.

  • PipWolf

    @ pakiestra, yes I’m well aware of what risk management is, thanks. I’ve been following the BabyPips risk management strategy for as long as I’ve been trading (about two years), and it has saved me on many occasions. In this case, I lost 1.5% of my total trading account, just like Cyclo. I wasn’t expecting to make hundreds of thousands, and I certainly wasn’t risking that much!

  • PipWolf

    @ Cyclo, don’t get me wrong, I love your blog and I’m well aware of how it’s intended. Keep the ideas coming, but I think I’m past the point in my Forex learning curve where I’ll go in on every trade with you :)

  • kusriono

    I’ve been watching Cyclo’s trade for 2-3 years. Not all of his trade is a jackpot of course. But, if you’re looking one of experience trader who humble enough to accept critism and so generous to share his trade, then you have it on this site! In the long run, still he’s a very very good trader. Not much trader I’ve seen has a simple method, easy to understand by noobs, but yet powerful.

    Just keep going Cylco ;)

  • PipWolf

    Okay all, I’m not saying that Cyclo burned me, I’m saying I burned me. I followed Cyclo’s trade (as I have followed all his and Pipcrawler’s trades for about the last year) even though I didn’t like it. I guess I was trying to say that I should have followed my own instincts to stay out of this trade instead of blindly trusting in Cyclo’s judgement. We’re ALL ultimately responsible for the trades we place, regardless of the sources of information we use to come to the decision to trade.

  • PipWolf

    @ pakiestra, yes I’m well aware of what risk management is, thanks. I’ve been following the BabyPips risk management strategy for as long as I’ve been trading (about two years), and it has saved me on many occasions. In this case, I lost 1.5% of my total trading account, just like Cyclo. I wasn’t expecting to make hundreds of thousands, and I certainly wasn’t risking that much!

  • PipWolf

    @ Cyclo, don’t get me wrong, I love your blog and I’m well aware of how it’s intended. Keep the ideas coming, but I think I’m past the point in my Forex learning curve where I’ll go in on every trade with you :)

  • kusriono

    I’ve been watching Cyclo’s trade for 2-3 years. Not all of his trade is a jackpot of course. But, if you’re looking one of experience trader who humble enough to accept critism and so generous to share his trade, then you have it on this site! In the long run, still he’s a very very good trader. Not much trader I’ve seen has a simple method, easy to understand by noobs, but yet powerful.

    Just keep going Cylco ;)

  • julian

    @ everyone..bottom line is that the markets are extremely volatile at present and have been for a while now. This makes it a lot harder, even for the most accomplished trader. Especially for a trader that posts his trade on the world wide web for all to see and follow! Thats what I call pressure and that is what takes balls ! So Cyclo I take my hat off to you, pipcrawler, happypip and gang. You generally have more winners than losers so keep up the good work, we appreciate it.

  • julian

    @ everyone..bottom line is that the markets are extremely volatile at present and have been for a while now. This makes it a lot harder, even for the most accomplished trader. Especially for a trader that posts his trade on the world wide web for all to see and follow! Thats what I call pressure and that is what takes balls ! So Cyclo I take my hat off to you, pipcrawler, happypip and gang. You generally have more winners than losers so keep up the good work, we appreciate it.

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  • nolosoft

    Do you mind have a look at TradeMax? A full featured tax software specifically designed for active investors or traders who have multiple accounts to manage their trade data, maximize their gain/loss strategy, prepare their Schedule D.

    TradeMax® debuts innovative new tools that enable active investors or traders to effortlessly manage all their trades across various accounts.With customizable Vista® style “Views”. TradeMax® delivers important investment account information right to the desktop, without the need to access Internet. Users can manage their trade data, maximize their gain/loss strategy, prepare their Schedule D. It can import trade data from all kinds of formats files, monitor realized/unrealized gains & losses for current positions, adjust wash sales events, report capital gains/losses in printed Schedule D format or export to popular tax software such as TaxCut®, TurboTax®

    All TradeMax® products are available today at http://www.nolosoft.com

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  • itrademax

    new features of TradeMax include

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    The new features of TradeMax include
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    2.) Comprehensive Corporate Events Module : Recording various corporate events, such as stock splits, stock merge, spinoff and symbol changes
    3.) Powerful importing module: TradeMax has pre-defined profiles support most brokers. TradeMax also provides a flexible format reorganization algorithm which allows you to customize your own format.
    4.) Intelligent Option Cost Basis Adjustment Function: Auto- detecting Assigned, exercised and expired option, also defers cost to corresponding shares with its Option Adjustment function.
    5.) Handle Wash Sales: TradeMax calculates various Wash Sale scenarios, include but are not limited to, Wash Sale between identical securities (stocks and options), Wash Sales on an unequal number of securities and Wash Sales on Same Day Rule.
    6.) Simplify tax preparation: TradeMax can assign short trades and convert short / long position, and calculates Wash Sales automatically. You can generate Capital gains/losses report for Schedule D purpose or export *.txf file to popular tax software such as TaxCut, TurboTax.
    7.) Analyze your trading performance: You can analyze your trading performance easily with the help of WashSales Detail Report,Summary Report, Transaction Report and Daily Market Value Report.
    8.) Powerful Forex Rate Module:Auto-convert the transactions under Non-USD currency into USD figures.

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