I spotted a potentially bullish chart pattern on AUD/CAD which had me thinking that this move is done for now. Closed up to take profits into the weekend. Here’s a quick review:
Last Forex Trade Update: Locking in Profit on AUD/CAD Short
On the latest four hour chart of AUD/CAD above we can see strong support at the .9750 minor support area, what looks like to me the beginning of the creation of a double bottom chart pattern. Having already caught a couple hundred pips on this pair–and after a 500 pip drop since the beginning of September–I thought it would be prudent to close out my remaining position manually (at .9770) and revisit this pair on Monday.
1st Half: +160 pips
2nd Half: +230 pips
Total: avg. +195 pips/ +0.78% gain
Overall, this was a pretty text book trade that had the luck of catching what was a broad move lower in commodities thanks to weak Chinese data and a very strong U.S. Dollar throughout September. I probably could have done better with my initial stop placement if I had taken more consideration of the 250 pip move it took to get to parity. A tighter stop would have improved my R:R ratio and it makes sense since there was already a clear trend, indicating there was a better than average chance of the mover continuing lower.
I’ll look at this pair again on Monday for a retest of minor resistance at .9850, and if it holds again, I just may jump back in short.
Also, I’ve closed out my EUR/GBP short orders at .7900 as the pair never pulled back since I posted. I’m still bearish on this pair, but it’ll go back to my watchlist for now.
That’s it! Thanks for check out my blog and I hope to see you all next week. Until then, have a great weekend!