EUR/USD: Bouncing Off 1.3800??? – First PT Hit!

Trade Closed: 2010-11-1 22:00

EUR/USD 4-hour Chart

Success! Thanks to my wide stop, my trade was able to handle all the volatility and hit my first profit target.

After my first profit target was hit, it seemed like the bulls were running out of steam. When the pair started falling, I decided to close my remaining position.

First pt hit at 1.3950: +147 pips
Second position manually closed at 1.3842: +39 pips
Total: +0.62%

What’s my next trade going to be? With the amount of high-profile economic data coming out today, I’m not sure if putting on a swing trade is a good idea. I think I’ll wait for the Fed’s decision on interest rates and QE before deciding on a directional bias…

Trade Idea: 2010-10-27 4:50

EUR/USD 4-hour Chart

Fundamentally, I still do believe that the focus remains on the Fed’s second round of QE and that this move down we are seeing in EUR/USD is simply a massive retracement of the overall trend. Eventually, bulls will buy it back up and take it to new highs… hopefully!

There’s also the poor results of the S&P Case-Shiller home price index. It showed that that house prices only increased 1% year-on-year, more than half the 2.1% reading initially expected. I think the weak housing market is a very strong indication that U.S. isn’t doing too hot!

I am keeping an eye out for the upcoming durable goods orders and new home sales though. If they come in worse-than-expected, it could trigger risk aversion, which is bad for my trade.

On the technical side of things, there seems to be a horizontal channel in EUR/USD’s 4-hour chart with support at the 1.3800 psychological stand. While I was looking at the chart I was soooo tempted to short when the red candle sported a long lower shadow.

Good thing I decided to be a good girl and waited for the candle to close! The support at my entry backed up the oversold region of Stochastic so I jumped in and shorted at market. I’m keeping my fingers crossed on this one!

I set my first profit target at the middle of the range at 1.3950, while my second profit level is at the top of the channel at 1.4100. I plan on pulling the plug if the pair goes below the previous low at 1.3645.

Long EUR/USD 1.3803, pt1 at 1.3950, pt2 at 1.4100, sl at 1.3645. I will risk 1% of my account on this trade.

That’s it for today. You can also follow me on MeetPips.com!

24 comments

  1. Buckscoder

    We have a range, thats true. Plus I see a better end than with your last trial. Not because of your fundamental analyzation. Just because of technicals. However, if you work with thoughts like: “I still do believe” or “hopefully!”, you are risking too much.

    I am just reading, because I have my own system and I trade only by system, not gut feeling or hope or beliefs.

    Anyways, good look!

    Reply
  2. gh0stJPY

    Technically trade is possible as i see your point, also COT report for the week indicates a BUY, although i have done sell both days with my system and currently looking at a SELL tomorrow also, i’d wait until end of day to see a clearer direction. But good luck!

    Reply
  3. tonton

    I am bearish, but you take this trade, why don’t you use much more tighter stop ? My stop would hit now (recent low)

    Reply
  4. Buckscoder

    We have a range, thats true. Plus I see a better end than with your last trial. Not because of your fundamental analyzation. Just because of technicals. However, if you work with thoughts like: “I still do believe” or “hopefully!”, you are risking too much.

    I am just reading, because I have my own system and I trade only by system, not gut feeling or hope or beliefs.

    Anyways, good look!

    Reply
  5. gh0stJPY

    Technically trade is possible as i see your point, also COT report for the week indicates a BUY, although i have done sell both days with my system and currently looking at a SELL tomorrow also, i’d wait until end of day to see a clearer direction. But good luck!

    Reply
  6. tonton

    I am bearish, but you take this trade, why don’t you use much more tighter stop ? My stop would hit now (recent low)

    Reply
  7. tonton

    Congratulations! Have you moved your stop (at least) to break even ?

    Now Pound looks more dominate in the market at the moment.

    Good Luck !

    Reply
  8. Hucklekiwi PipHuck

    Yes I’ve hit my first pt and when I saw EUR/USD stall at 1.3950 and drop, I decided to close my second position too. I’ll update this as soon as I can! For now I must go back to sleep! Sometimes, I just hate living in EST! :(

    Reply
  9. tonton

    Congratulations! Have you moved your stop (at least) to break even ?

    Now Pound looks more dominate in the market at the moment.

    Good Luck !

    Reply
  10. Hucklekiwi PipHuck

    Yes I’ve hit my first pt and when I saw EUR/USD stall at 1.3950 and drop, I decided to close my second position too. I’ll update this as soon as I can! For now I must go back to sleep! Sometimes, I just hate living in EST! :(

    Reply
  11. mrscashflow

    I was pleased to follow you Noob on this trade you was right about the direction. I closed my position today in the last hour 1/2 or before the market closed. I was holding out for my TP Bc today being Friday a short day I took my pips ;-D Thanks a lot!! I could had a much higher close @ 11.90 I’m good though ;-D

    #14524868 buy 0.01 EURUSD at 1.3821
    sl: 1.2000 tp: 1.4025
    closed 0.01 at 1.3925

    Reply
  12. mrscashflow

    I was pleased to follow you Noob on this trade you was right about the direction. I closed my position today in the last hour 1/2 or before the market closed. I was holding out for my TP Bc today being Friday a short day I took my pips ;-D Thanks a lot!! I could had a much higher close @ 11.90 I’m good though ;-D

    #14524868 buy 0.01 EURUSD at 1.3821
    sl: 1.2000 tp: 1.4025
    closed 0.01 at 1.3925

    Reply
  13. host07

    Quote:” Long EUR/USD 1.3803, pt1 at 1.3950, pt2 at 1.4100, sl at 1.3645. I will risk 1% of my account on this trade.”

    Is it true, that your Risk-Reward Ratio here is 1:0.93 for pt1? As a complete newbie in Forex I am kinda unsure whather this is a good ratio?

    Reply
  14. host07

    Quote:” Long EUR/USD 1.3803, pt1 at 1.3950, pt2 at 1.4100, sl at 1.3645. I will risk 1% of my account on this trade.”

    Is it true, that your Risk-Reward Ratio here is 1:0.93 for pt1? As a complete newbie in Forex I am kinda unsure whather this is a good ratio?

    Reply
  15. Hucklekiwi PipHuck

    Yes that’s my risk reward ratio for my first position. :) I’m a newbie as well, but I believe risk:reward ratios vary from person to person. You can still have a risk:reward ratio that is more than one, but if you end up wining more, then it will balance out!

    Reply
  16. Hucklekiwi PipHuck

    Yes that’s my risk reward ratio for my first position. :) I’m a newbie as well, but I believe risk:reward ratios vary from person to person. You can still have a risk:reward ratio that is more than one, but if you end up wining more, then it will balance out!

    Reply

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