Forex Trade Adjustments: EUR/JPY and NZD/CAD

Both my EUR/JPY and NZD/CAD trades have taken turns against me, so I decided to adjust my stops to limit my risk in case this isn’t just a spike in volatility.

Short EUR/JPY 

Original Trade Idea: Shorting EUR/JPY into the Downtrend

EUR/JPY 1 Hour Forex Chart

EUR/JPY 1 Hour Forex Chart

My EUR/JPY short hasn’t necessarily been invalidated, but the pair is starting to behave like it’s ready to break the strong resistance around 135.30 that’s held since I opened up this position.  We can see on the one hour chart above, the pair is forming an ascending triangle, likely on the idea we may see a not so disastrous outcome from the EU-Greece issue.

To me if it breaks that resistance, then my trade is technically invalidated and there’s not reason to hold it all the way to my max stop.  So, I decided to adjust my max stop from 137.00 to 135.70 in case there is a break higher; my max risk now is 0.56% of my account.  If not and the EU-Greece negotiations fall through, then this trade could end up going my way, so I’m going to let it ride until one or the another scenario plays out.

Short NZD/CAD

Original Trade Idea: NZD/CAD Reversing to the Downside?

NZD/CAD 4 Hour Forex Chart

NZD/CAD 4 Hour Forex Chart

NZD/CAD on the other hand has broken the falling trendlines on Loonie weakness, likely sparked by a sharp drop in oil.  This technically invalidates my short position as it looks like the reversal back to the downside, and my idea that oil is oversold.  But in case this is just another spike in volatility and the market returns to the downtrend, I decided to adjust my max stop from .9550 to .9350 on this trade as well rather than close it out. This drops my max risk from 1.00% to 0.50%, another very small loss if this drop in oil (and thus the Loonie) keeps on going.

Nothing much to do now but wait and see what’s happens with Greece and oil, and where the market takes me for the rest of the week. Stay tuned!