Forex Review: 2014-03-23
Here’s a quick review on my CAD/JPY short, which I decided to close after Friday’s set of positive Canadian data.
Before you move on, for those who are not familiar with my framework, signals, setups, or acronyms, please visit my discretionary trading framework blog.
Original forex trade idea: Swing Short on CAD/JPY
Not too long after my CAD short adjustments, Canada posted some pretty good retail sales and inflation numbers. A positive surprise like this will most likely have those traders thinking we’ll see a rate cut from the Bank of Canada soon take a step back and re-evaluate. I happen to be one of those forex traders, which is why I decided to close this trade out by closing my remaining position at 91.39.
1st half: +90 pips
2nd half: +51 pips
Total: +70.5 pips/ +0.39% gain
Not that I think one set of data points equals a confirmation that Canada and trader sentiment are turning around, but I think it is enough for a good amount of traders to lighten up their shorts in the short-term to give a significant boost…for now.
In hindsight, I think I did the right thing as I think this past Friday’s Canadian data was game changing news in terms of seeing a rate cut, plus after such a long period of selling, I expect quite a bit of pullback on CAD pairs on profit taking.
So, I’m flat into the weekend and for the upcoming week, stay tuned for a potential idea on NZD/CAD as it still looks on of the few pairs with both solid fundamental and technical arguments.
That’s it for now. Thanks for checking out my blogs…good luck and good trading!