EUR/AUD & NZD/CHF Trade Update

Forex Trade Updates: 2014-08-15

My positions in both EUR/AUD & NZD/CHF have been on the move, so it’s time to do a quick assessment and update ahead of the weekend!

Short EUR/AUD

Original Trade Idea: Shorting EUR/AUD at Previous Consolidation

EUR/AUD 4 Hour Forex Chart

EUR/AUD 4 Hour Forex Chart

It looks like the combination of Fibs and moving averages did manage to draw in sellers, at least when you couple the in the shift away from risk aversion sentiment as geopolitical tensions seemed to have eased for a bit.  Unfortunately, we got fresh news of violence between Russia and Ukraine to spark broad risk aversion sentiment, which means a move away from risk currencies like the Australian Dollar.

Fundamentally and technically, this trade still makes sense, but it seems like geopolitics is a big X factor as to how this may turn out.  But since I am collecting carry and the trade is still profitable, I’ll hold for now since those things give me a bit of room to breath.  No adjustments for now.

Long NZD/CHF

Original Trade Idea: Entry Adjustment On NZD/CHF

NZD/CHF 4 Hour Forex Chart

NZD/CHF 4 Hour Forex Chart

Since geopolitics seems to be the main driver of price action as of late, a lot of what I said for EUR/AUD applies here to NZD/CHF.  The only difference would be the broad lack of buying sentiment for the New Zealand Dollar has me a bit concerned on whether this trade is still legitimate.

I had a feeling that the post rate hike pullback would last a while and may be deep, but as of right now, it’s technically still in the long-term uptrend.  And in my view, as long as the 61% Fib holds, I don’t see a reason to close for now, especially as I continue to collect carry interest on this position as well.  Of course, if it does break, I won’t hesitate to cut the trade to save myself from a bigger loss than necessary.  For now, no adjustments on this forex trade as well, and I’ll re-assess after we see what happens in geopolitical news over the weekend.

Until then, trade safe, stay tuned…and have a great weekend!