Closed EUR/JPY & GBP/JPY Forex Trades

Forex Trade Review: 2014-08-29

With Japan showing weakness across its economy, I decided to close out my Japanese Yen long forex trades.  Here’s my review.

Short EUR/JPY

Original Trade Idea: Downtrend Channel in EUR/JPY

EUR/JPY 4 Hour Forex Chart

EUR/JPY 4 Hour Forex Chart

As I mentioned in my last position update, risk sentiment shifted towards positive with the lack of geopolitical tension news over the past week or so.  Risk-on sentiment tends to bring back Yen sellers, and when you combine it with fresh weak Japanese data to bring on possibly more BOJ easing, not even the strong bearish euro sentiment can really bring this pair down.

After a few weeks of euro selling and the ECB meeting coming up next week, I decided I’ll take what little profit I can now to avoid a potential profit taking/oversold reaction, and Yen sellers hopping back into the market.  Closed manually at 136.75. 

Total: +25/ +0.16% gain

In hindsight, I should have been a little more patient to wait for the pullback all the way to the top of the channel, but with momentum so strong to the downside for the euro, I still think hopping in when I did was the right move…but we’ll see how everything goes with the ECB next week.

Short GBP/JPY

Original Trade Idea: Swing Short on GBP/JPY

GBP/JPY 4 Hour Forex Chart

GBP/JPY 4 Hour Forex Chart

Despite the beautiful technical setup I mentioned in my original trade idea still not being invalidated, I feel that with the Japanese data coming in weaker and broad risk sentiment moving higher, there were more drivers to the upside than down at the moment.  But to be honest, I’m not sure what we’ll see in September as market players come back from Summer vacation, and how geopolitical risk will continue to affect guppy, especially after the U.K. raises its terrorism threat level today. I decided to close manually at 172.49 to cut my losses quick and live to trade another day.

Total: -36 pips/ -0.18% loss

As I mentioned in the chart above, this is a market I’ll continue to watch and see if the moving averages and Fibonacci levels hold as resistance, but for now, I think I made the best decision based on what I see today.

Overall, with the two trades combined it’s barely a scratch to my account and on the positive side, my GBP/CHF long forex position is starting to kick butt now that the pair has broken to the upside to close the week up above the 1.5200 handle!  So, I still get to go into the long holiday weekend with an account that’s still up on the week.  Can’t ask for anything more than that…have a fun and safe weekend!