Falling Trend Line on the EURUSD – Trade Closed

Trade Closed 2010:02:08 21:31

PoD Chart

One pip. Yep, one pip away from hitting my profit target. In retrospect, I should not have let my trade run like that, especially since price has already bounced from the previous week’s low. Could’ve, would’ve, should’ve. Ah, well, at least I walk away with some profit.

Even though the Greek tragedy – err, I meant Greek debt problems – has kept the euro weak recently, risk appetite put up a strong fight before the week came to a close. Relatively upbeat economic figures from the US boosted the higher-yielders, putting an end to their week-long losing streak. Although euro zone inflation figures came in below consensus, the euro was able to make headway against the greenback, probably because its drop was way overdone and I guess it was time for a pullback.

Closed 1st half at 1.3540: +120 pips
Closed 2nd half at 1.3660: +0 pips


Total: 0.60% gain

Trade Idea: 2010-02-22 21:23

PoD Chart

Trading was a bit slow yesterday and, with barely any economic reports on deck, the EURUSD wasn’t able to climb all the way up to my desired entry point at 1.3700. However, the downtrend line still remains intact so I just decided to adjust my trade a bit. I moved my short order to 1.3660, right at the 61.8% Fibonacci retracement level.

Here’s my new plan:

Short at 1.3660, pt1 at 1.3540, pt2 at 1.3450, sl at 1.3760

Trade Idea: 2010-02-21 21:28

PoD Chart

Ooohh. Do you see that downtrend in the EURUSD’s 4-hour chart? Shorting it might be a good idea… The pair, however, might have some juice left to go up further since the stochastics are not yet in the overbought territory. It’s okay. Patience is a virtue. I’ll just wait for it to climb a little bit before I go in. But hey, we’ve got a couple of major events starting Tuesday that could take price to my entry point.

First up on the economic calendar this week is the German Ifo business climate report. Although it is predicted to show a rise, I think we might could see it come out lower-than-expected with all this Greek debt talk. With all the uncertainty surrounding Greece and the entire euro zone, I suspect risk aversion will be in play soon enough. Needless to say, this would cause some major euro selling, which would bring the EURUSD down once again.

Looking further ahead, there are some major reports from the US, namely the CB consumer confidence survey, the new home sales, the durable goods orders, the weekly unemployment insurance claims and the very important preliminary GDP report. If these reports come in better-than-expected, we could see more dollar buying.

I’m placing a short order right at the downtrend line (1.3690) with my stop loss at 1.3800. My profit targets would be at 1.3550 and 1.3450.

Here’s my master plan:

Short at 1.3690, pt1 at 1.3550, pt2 at 1.3450, stop at 1.3800.

  • personalme

    Bravo bravo. I was hit at perfect point. It is a rare thing to have a perfect trigger like that. Gud luck Huck! I’m with you but at neighbor wagon: cable.

  • personalme

    *it was hit at perfect point. Typo.

  • personalme

    Bravo bravo. I was hit at perfect point. It is a rare thing to have a perfect trigger like that. Gud luck Huck! I’m with you but at neighbor wagon: cable.

  • personalme

    *it was hit at perfect point. Typo.

  • sunglow

    I was watching the EUR/USD today and I thought that your new entry point was as near perfect as it gets. As I write this, you have already past your first profit point and have presumably moved the stop loss on the second part of your trade to that point. Pretty good reading of the charts.

  • ashag28

    good plan, i got in at 3673

  • sunglow

    I was watching the EUR/USD today and I thought that your new entry point was as near perfect as it gets. As I write this, you have already past your first profit point and have presumably moved the stop loss on the second part of your trade to that point. Pretty good reading of the charts.

  • Thatskewl2

    Hey Huck,
    You usually do a very good job explaining your train of thought when picking a entry or exit level. However, I have a question on your entry level with this trade. Can you tell me why your decide to make your target entry at $1.3700 which didn’t get hit and was not at any Fib. level….. Can you walk me through you train of thought there?

    Thanks

  • ashag28

    good plan, i got in at 3673

  • Huck

    My initial order was at 1.3700 because of two reasons: one, it is a psychologically significant round number and two, it intersects with the falling trend line! :)

  • Huck

    @personalme, sunglow, ashag28, Thatskewl2 Thank you very much for your comments. You do know how to make a girl blush! :P

  • Thatskewl2

    Hey Huck,
    You usually do a very good job explaining your train of thought when picking a entry or exit level. However, I have a question on your entry level with this trade. Can you tell me why your decide to make your target entry at $1.3700 which didn’t get hit and was not at any Fib. level….. Can you walk me through you train of thought there?

    Thanks

  • Huck

    My initial order was at 1.3700 because of two reasons: one, it is a psychologically significant round number and two, it intersects with the falling trend line! :)

  • Huck

    @personalme, sunglow, ashag28, Thatskewl2 Thank you very much for your comments. You do know how to make a girl blush! :P

  • sunglow

    I agree with the logic of your initial price of 1.3700. It is amazing how the human mind is fascinated by noughts. Look at the party when the year 2000 started. I am sure that many traders reflect this fascination when setting stop losses and they will always go for round numbers. Still a great change to the Fibonacci level. When your first profit target was hit, did you move your stop loss? If so, to what level?

  • sunglow

    I agree with the logic of your initial price of 1.3700. It is amazing how the human mind is fascinated by noughts. Look at the party when the year 2000 started. I am sure that many traders reflect this fascination when setting stop losses and they will always go for round numbers. Still a great change to the Fibonacci level. When your first profit target was hit, did you move your stop loss? If so, to what level?

  • Huck

    Yup! I have moved my stop to my initial entry (1.3660) for a risk-free trade.

  • Huck

    Yup! I have moved my stop to my initial entry (1.3660) for a risk-free trade.

  • haniff0

    hi huck

    it was agood call nevertheless.

    in future do not put 50 or 00 entry/exit.

    try 52/48 or 98/02 they always work.

  • haniff0

    hi huck

    it was agood call nevertheless.

    in future do not put 50 or 00 entry/exit.

    try 52/48 or 98/02 they always work.

  • sunglow

    Hi Huck. I think that you are being too hard on yourself. 120 pips profit from a trade is very good and you could have had more without any risk. I think that it is a very good comment by haniffO.

  • sunglow

    Hi Huck. I think that you are being too hard on yourself. 120 pips profit from a trade is very good and you could have had more without any risk. I think that it is a very good comment by haniffO.

  • Huck

    Okay, okay… That calmed me down. Thank you.

  • Huck

    Okay, okay… That calmed me down. Thank you.

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