Stopped Out: 2010-08-12 2:49
Yeah, I lost. Boo hoo! Even though I was right about the FOMC engaging in quantitative easing measures, it wasn’t enough to really weigh down on the dollar. The problem with my trade idea is that I didn’t factor in the reversal in the market’s sentiment from risk appetite to risk aversion. I was only up by 58 pips when EURUSD reversed and headed down the charts. Eeek!
I guess I should have moved my stop loss to breakeven when I had the chance to. Sigh. But don’t worry, this 130-pip loss won’t stop little ole me from checkin’ out hot set ups on the charts. Skadoosh!
Stopped out at 1.3040 for -130 pips / -1.00%
Trade Idea: 2010-08-10 2:56
Well, hello euro! I couldn’t ignore that sexy long-legged doji hangin’ out on the minor resistance level at 1.3130, hollering at me to go long. So yeah, I’m buying the EURUSD but not until it reaches 1.3170. I’ll wait for the pair to gain some momentum first and ride the wave.
I went through Pip Diddy‘s blog today and I found out that the FOMC is due to talk later. For those of you who don’t know yet, that is an OMG-worthy event even though it’s no surprise that we won’t be hearing any rate hike from the Fed. Boo hoo! They may talk about quantitative easing and that’s where things could get crazy!
However, I’m hoping that the market will shoo away risk aversion that could come knockin’ when the FOMC expresses its pessimism on the US economy. I’m looking forward to a repeat of NFP Friday when the bulls looked past risk aversion and focused on the Euro zone, which seems to be in a better shape than the US. So let’s go euro!
On the technical side of things, I noticed that EURUSD seems to have found support at former lows. With a long-legged doji forming, I believe the retracement could be over. I’m not going to jump in just yet though! I’ll wait until upward momentum picks up before I enter. I’ll ultimately target 1.3500, but I’ll take some profits off the table at former highs at 1.3300.
As for my stop, I have placed it 130 pips away, roughly equal to the pair’s average true range. Hopefully, my stop will be enough to survive the crazy volatility tonight brought about by the Fed’s interest rate decision.
Long EURUSD 1.3170, pt1 at 1.3300, pt2 at 1.3500, sl at 1.3040.
That’s my trade idea for this week. If this trade gets invalidated tomorrow, I will close my orders and find opportunities elsewhere. Don’t forget to follow me on MeetPips.com too!