Trade Update: 2011-8-2 3:42
I have to confess something. Are you ready? Well, I kinda earned zero dollars on this trade. I basically closed at a loss because I was afraid price was going against me. Instead of earning a huge amount of pips, I ended up with a 0.50% loss!
As you can see from the chart, my stop was placed perfectly as price found major support at 1.6260. It’s obvious that fear got the better of my. I didn’t have faith in my plan and cut my losses early. Lesson learned!
Anyhoo, I’m currently looking for new setups to trade on the majors. If you have anything in mind, don’t hesitate to hit me up!
Trade Update: 2011-7-28 1:42
And I’m in! In accordance to the trading plan that I wrote yesterday, I bought Cable as it found support around the 61.8% Fibonacci retracement level. I bought at market at 1.6332 and placed my stop below the most recent swing low at 1.6250.
I’m ultimately aiming for new highs, but I want to manage this position conservatively. That’s right, I’ll be playing “Little Miss Conservative Huck” (no miniskirts and short shorts, ha!) this week as I want to end the month with a win! I put on two positions, with each only having a 0.5% risk, to enable me to easily scale out of my trade. This time I’ll make sure I don’t forget to move my stop to breakeven. Pinky promise!
In the event that price tests the most recent high, I plan to close half and let the other position run! I hope I do well on this trade!
Trade Idea: 2011-7-27 3:42
I’ve decided to go with the flow and get the most out of the market’s seemingly anti-dollar sentiment by buying GBP/USD. I hope it’s not too late to sell some Greenbacks!
Of course, before going in a trade, I always try to check the fundamentals first. For now, it looks like traders are staying away from the dollar due the ongoing debt ceiling debate. With each day that passes without a resolution, the chances of the U.S. losing its AAA credit rating increases.
It’s also important to note that Greece finally received the much-needed bailout funds from the European Union. Over time, I believe that debt worries in the euro zone will fade.
Technically, the pair is currently retreating from its six-week highs with Stochastic easing out of overbought conditions. However, given the recent dollar weakness as of late, I’m thinking that perhaps what we’re seeing now is nothing more than just a retracement.
I believe Cable will find at least some support between the 38.2% and 61.8% Fibonacci retracement levels. My ideal entry is at the 61.8% Fib level, around last week’s high at 1.6330. But if I start to see signs of a reversal (c/o my ever-so-reliable candlestick cheat sheet) at higher levels, I think I will pull the trigger to buy.
If my trade gets triggered at 1.6330, I’ll set my stop below this week’s low at 1.6260 and then maybe aim for a little higher than today’s high at 1.6470? If my plan works out, I will have a 2:1 return on risk ratio with this trade!