Here’s a quick forex review on my CAD/JPY short, which closed at its target shortly after trailing my stop to lock in profits.
Original Trade Idea: Technical Forex Short Opportunity on CAD/JPY?
After my trail stop adjustment on Thursday, the Loonie saw a round of broad selling pressure, likely on the back of the continued drop in oil prices recently. So, after a week of stagnation in price action, volatility picked up once again thanks to sellers hopping in, which eventually pushed the market to my target at 94.75 to close me out at the previous swing low.
Total: +200 pips/ +0.25% gain
Overall, it was another simple textbook Fibonacci retracement setup with weakening oil as the fundamental driver for Loonie weakness, and it all worked out this time. I’m still bearish on the Loonie, so I’ll likely look for another short on this pair, especially with the U.S. equity markets taking a dip on Friday. This may lead to some risk aversion behavior in the coming week, which tends to benefit the Japanese yen because of its perceived “safe haven” status. Stay tuned for new ideas and have a great weekend!