Cross-Eyeing: EUR/CHF – Trade Review

Trade Review: 2007-04-15 21:50

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Our last trade idea was triggered shortly after I posted, and we saw a stong rally in the pair from the 61.8% Fibonacci level. Too bad we had only a 25 pip target, because that thing shot up! So, we did well for the week and a look forward to a bounty of inflation data this week from various countries. Stay tuned!

Half position: +25 pips

Total from EUR/CHF this week: +50 pips

Trade Update: 2007-04-13 09:50

crosseyed chart

Soon after I posted my trade idea on EUR/CHF, it triggered half a position and reached its profit target. Since then the pair has dropped back down to our original buy area. Stochastics are once again in the oversold area and fundamentals really haven’t changed. Is this another buying opportunity? I would say it is, but with the G-7 meeting this weekend I would take a smaller position size into the weekend to limit risk.

So to review on our trade:

Total: +25 pips

and a new trade idea:

Long half position EUR/CHF at 1.6365, stop at 1.6340, pt at 1.6390

This would essentially be a no risk trade because if we were to incur a loss, it will be offset by the gains made yesterday. Good luck!

Trade Idea: 2007-04-12 10:00

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Good Morning! Today the ECB decided to keep rates at 3.75%. This led to a Euro sell off as traders, who were betting that we would see a surprise rate hike, lighten their positions on the Euro. Inflation still remains a risk as the Eurozone continues to stay above the 2% inflation target, so the outlook is still bullish that the ECB will raise this year.

Today, ECB President Trichet stated, “Our monetary policy continues to be on the accommodative side” and the inflation outlook “remains subject to upside risks.” So, while we saw a sell off, this is temporary as the market will continue to buy Euros with this outlook.

EUR/CHF still looks to be a viable carry trade play, and with today’s sell off, it looks like traders can jump in this one at a better price. We will use the Fibonacci retracement tool to find that better price at the 61.8%, which happens to be today’s pivot point area as well.

Long half position EUR/CHF at 1.6380, stop at 1.6345, pt at 1.6405

Long half position EUR/CHF at 1.6365, stop at 1.6345, pt at 1.6390

Please remember to never risk more that 1% of your account on any single trade, so please adjust your position sizes accordingly.