Forex Adjustment: Stop to Breakeven
After a bit of dizzying volatility for EUR/NZD around the ECB monetary policy meeting last week, the forex traders are back to pushing this market lower. It’s time to make it a risk free trade.
Original trade idea: EUR/NZD Breaking Major Support at 1.6000?
After topping out around 1.6150, it looks like the pullback did pull in sellers, especially since Draghi did have dovish remarks on the economy after the ECB monetary policy meeting. It’s been all downhill since then with the pair back below my 1.6050 entry, getting as low as 1.5837, so I thought I’d create a risk-free position by moving my stop to break even: Position stop moved to 1.6050. Risk-free trade.
My next move is to see what happens if the market reaches the previous swing low around 1.5770; if story changes or I see strong support, I’ll reduce my risk there by trailing my stop once again and/or closing down a portion (or all) of the position. If it doesn’t hold, I’ll look to scale in another small position to maximize my gain and trail my stop to maintain low risk.
Finally, we do get the Reserve Bank of New Zealand monetary policy decision on April 23. If I’m still in the trade, I’ll readjust once again ahead of this event to reduce risk in case we get any bearish surprises for the Kiwi from the RBNZ.
That’s it for now. What do you think about this trade, or how else do you see adjusting this winning position? Leave a comment below!