Trade Closed: 2008-08-20 17:00
The Swiss France fell against the majors today after a report shows the Swiss money supply grew at a slower pace. My short position was stopped out as the EUR/CHF quickly found a bid and buyers took the pair to 1.62.
Total: -50 pips/ -1.0% loss
So, a bit of a surprise that a low level economic event would have cause this much volatility, but it’s the markets where anything can happen! Thank goodness for money management! The trade was frustrating one as I had a nice profit reverse on me, but it’s time to move on and look for the next trade opportunity.
Trade Update: 2008-08-19 19:11
Good evening! Just a quick update on price action in EUR/CHF.
After my entry, the pair made it’s way lower towards the first profit target at 1.6100, during the morning US trading session. Unfortunately, the first profit target was not hit as it was missed by a mere pip or two before EUR/CHF traded back higher to its current level around 1.6130.
There are no major risk events for either the Euro or Swiss Franc, so price action will most likely be dictated by global risk movements.
I will continue to hold on to my short position for now. Stay tuned!
Trade Idea: 2008-08-18 12:00
Good afternoon! We’ve got a nice chart setup forming on EUR/CHF as the pair finds resistance at previous support.
I’ve put up an hourly chart, and we can see the pair sat on support around 1.6173 for a few days before breaking lower on Friday. The pair made a run to 1.6100 where buyers pushed the pair back up to the broken support line. It looks like this line is now acting as a resistance area. It also happens to line up with the 61% Fibonacci level of the swing move from about 1.6237 to 1.6097 and stochastics are indicating an overbought environment in the short term. I look to short the market around this area with my stop above the 61% Fibonacci area. I am going to:
Short EUR/CHF at market (1.6151), stop at 1.6200, pt1 at 1.6100, pt2 at 1.6050
Remember to never risk more than 1% of a trading account on any single trade. Adjust position sizes accordingly.
Economic risk events should pick up tomorrow with ZEW economic sentiment data. Stay tuned for updates and adjustments!