Cross-Eyeing: EUR/CHF – Close Trade

Close Trade: 2008-12-31 11:09

Greetings! Before I go off to celebrate and usher in 2009, I thought I’d end 2008 on a positive note by closing my short EUR/CHF position down and locking in a nice profit.

Closing remaining short position on EUR/CHF at market (1.4830).

1st Half: +200 pips
2nd Half: +445 pips
Total: +1.61% gain

Not a bad way to close out 2008 and usher in 2009, huh? This exit was mostly for book keeping purposes – I am still short bias on EUR/CHF on the possibility we may see Eurozone weakness and further ECB rate cuts. I look to re-enter short in the New Year, hopefully at a great price again. So, stay tuned, good luck in 2009, and have a wonderful and safe New Year my friends!

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Trade Adjustment: 2008-12-22 11:23

Good morning! My first profit target was in at 1.5075 in morning European session trading. Half of my position was closed to lock in a profit, and now it’s time to make an adjustment!

Half position closed to lock in profit at 1.5075. Adjusting stop on remaining position to break even at 1.5275 to create a risk free trade. I will continue to target 1.4725, and trail my stop by 200 pips along the way.

So, it’s nice to have a bit of profit before I take off for some holiday fun and sun. I will be back next week to do an update or adjustment if necessary. ‘Til then, have a fun and safe holiday! See ya next week!

Trade Idea: 2008-12-22 12:09

crosseyed chart

Good afternoon! In my last post, I mentioned that EUR/CHF is breaking a rising trendline on the daily charts. It looks like that break is holding, so I’d like to throw on some shorts for a nice and easy technical trade.

First, a couple thoughts on fundamentals. I am still bearish in the longer term on Euro as I think the Eurozone is having the same problems as the US – recession, falling inflation, housing, etc. Coupled with the problem of 27 different economies trying to agree on how to battle the current economic environment. Some are getting hurt more than others. The Euro has risen quite a bit in a short period of time, which brings on the concern of how it affects it’s export economy. I think we may see the ECB cut rates at their next meeting to fight the recession and prevent the Euro from rising to fast. Just my humble opinion on what it looks like. I also think there is still more de-leveraging to go and a lack of institutions willing to take on meaningful risk at this point. Really, who wants to take on risk in this environment?

It’s pretty simple really. On the chart, we can see the pair breaking the trendline, and within the past few hourse, the pair has broken below last week’s lows. I am going to short the break of last weeks lows. My stop is just outside of the average daily range of about 185 pips. I will target the minor support level we saw in the rise higher, and ultimately 1.43. Here’s what I’m going to do:

Short EUR/CHF at market (1.5275), stop at 1.5475, pt1 at 1.5075, pt2 1.4725

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

It’s been a volatile market as liquidity dries up during the holidays. Expect the same this week. Be very cautious and always be defense oriented. Stay tuned and Happy Holidays!

  • debonaire

    Yo Cross, is the EUR/CHF impacted by U.S. economic data? For example, USD Gross Domestic Product report.

  • debonaire

    Yo Cross, is the EUR/CHF impacted by U.S. economic data? For example, USD Gross Domestic Product report.

  • hany_egypt

    Congrats Cyclopip, your 1st target is hit ..
    Unfortunately I didn’t join your trade this time ..

  • hany_egypt

    Congrats Cyclopip, your 1st target is hit ..
    Unfortunately I didn’t join your trade this time ..

  • cyclopip

    Thanks for your comments! Debonaire – in recent months US economic data has had an affect on all currencies on a sentiment basis. Meaning, bad news leads to risk aversion (selling higher-yielding currencies) and good news leads to a higher risk tolerance (buying higher-yielding currencies). This may change as we slowly head out of what of this de-leveraging period, or it may not. We will have to wait and see as we head into the new year…

  • cyclopip

    Thanks for your comments! Debonaire – in recent months US economic data has had an affect on all currencies on a sentiment basis. Meaning, bad news leads to risk aversion (selling higher-yielding currencies) and good news leads to a higher risk tolerance (buying higher-yielding currencies). This may change as we slowly head out of what of this de-leveraging period, or it may not. We will have to wait and see as we head into the new year…

  • nkada

    hai cyclopip, im pretty new in forex trading and about to open my LIVE acct. by Jan’09. what’s your advice for me to trade better and how to maximise my profit and minimize lost. Thanks

  • nkada

    hai cyclopip, im pretty new in forex trading and about to open my LIVE acct. by Jan’09. what’s your advice for me to trade better and how to maximise my profit and minimize lost. Thanks

  • cyclopip

    Greetings Nkada – If you understand the fundamentals of trading and how the forex markets work, then the next step is to open a demo account and practice your chosen trading system or method. Once you have demoed for a bit, long enough to practice your system in different market environments and you are able to adjust/adapt, then open a live account with a VERY SMALL amount that you are 100% willing to lose. This is where you practice your system with the pyschological affects of real money. If you don’t have a complete system and trade plan yet(analysis, entry & exit strategy, money management, etc.),then DO NOT OPEN A LIVE ACCOUNT…

  • cyclopip

    Greetings Nkada – If you understand the fundamentals of trading and how the forex markets work, then the next step is to open a demo account and practice your chosen trading system or method. Once you have demoed for a bit, long enough to practice your system in different market environments and you are able to adjust/adapt, then open a live account with a VERY SMALL amount that you are 100% willing to lose. This is where you practice your system with the pyschological affects of real money. If you don’t have a complete system and trade plan yet(analysis, entry & exit strategy, money management, etc.),then DO NOT OPEN A LIVE ACCOUNT…

  • debonaire

    Cyclopip, nice EUR/CHF trade. I entered around the same time that you entered, and I am still riding. Good looking out!!!

  • debonaire

    Cyclopip, nice EUR/CHF trade. I entered around the same time that you entered, and I am still riding. Good looking out!!!

  • tradeforex73

    Cyclopip,

    I am reading your posts with interest and was wondering if you post your “entries” into your positions for all to see prior to posting the overall results . Maybe I am just confused!

    Please advise.. Much appreciated.

  • tradeforex73

    Cyclopip,

    I am reading your posts with interest and was wondering if you post your “entries” into your positions for all to see prior to posting the overall results . Maybe I am just confused!

    Please advise.. Much appreciated.

  • MonsterTrader

    Holy crap man! Nice trade!

    I wanted to jump in on the second tgt, but held back.

    Congrats!

    You guys @ babypips should send out emails every time a new trade is posted!

  • MonsterTrader

    Meaning, bad news leads to risk aversion (selling higher-yielding currencies) and good news leads to a higher risk tolerance (buying higher-yielding currencies).

    I know your not an economics teacher…but whats the reasoning behind risk aversion and higher risk tolerance?

    I’m thinking higher risk tolerance happens b/c ppl are drawn to that currency thinking it may appear more stable, and provide a higher return.(?)

  • MonsterTrader

    Holy crap man! Nice trade!

    I wanted to jump in on the second tgt, but held back.

    Congrats!

    You guys @ babypips should send out emails every time a new trade is posted!

  • MonsterTrader

    Meaning, bad news leads to risk aversion (selling higher-yielding currencies) and good news leads to a higher risk tolerance (buying higher-yielding currencies).

    I know your not an economics teacher…but whats the reasoning behind risk aversion and higher risk tolerance?

    I’m thinking higher risk tolerance happens b/c ppl are drawn to that currency thinking it may appear more stable, and provide a higher return.(?)

  • cyclopip

    Thanks for the comments everyone! Tradeforex73 – I do post my trades usually with where I will enter before my results. The top of the posts are the latest updates and the bottom is the original trade idea.

  • simon006

    happy new year pipcrawlers, the market is just commencing for the year… and there has being a significant strength factor on the usd to chf and jpy. the dollar is gain appreciation to the chf and jpy in the pair ( usd/chf and usd/jpy) in a long term bcos of the outlook of the bail out plan for the us-economy. buy was the long term for usd/jpy and usd/chf since 30th dec,31st dec, 2nd jan based on the time series from last year and the outlook to bail the economy the dollar is showing appreciation to most currency pairs.

  • cyclopip

    Thanks for the comments everyone! Tradeforex73 – I do post my trades usually with where I will enter before my results. The top of the posts are the latest updates and the bottom is the original trade idea.

  • simon006

    happy new year pipcrawlers, the market is just commencing for the year… and there has being a significant strength factor on the usd to chf and jpy. the dollar is gain appreciation to the chf and jpy in the pair ( usd/chf and usd/jpy) in a long term bcos of the outlook of the bail out plan for the us-economy. buy was the long term for usd/jpy and usd/chf since 30th dec,31st dec, 2nd jan based on the time series from last year and the outlook to bail the economy the dollar is showing appreciation to most currency pairs.