After adjusting my stop once again ahead of the Non-Farm payrolls number, the USD pulled back to hit after a lower than expected read. Here’s a quick forex trade review.
Original Trade Idea: Long USD/CHF after FOMC
In my last trade update, I adjusted my stop to breakeven, canceled my orders to buy another half position at .9450, and put up buy orders at .9750. Today ahead of the NFP number, I adjusted my stop one more time to .9650 to lock in 100 pips profit with big event risk approaching. The NFP number came in below expectations at 214K vs. 235K forecast/256K previous, and the unemployment rate ticked lower to 5.8% from 5.9%. The initial reaction was a whipsaw move before forex traders began to sell some Greenbacks, which eventually pushed USD/CHF to my adjusted stop at .9650 to close out my trade.
Total: +100 pips/ +0.37% gain
I’m glad I adjusted my stop, but an alternative move to take would have been to close out the trade to lock in more profits and leave my buy orders at .9750 open in case there was a big positive surprise and pop higher. That gives up an even bigger profit in case that pop higher scenario played out, but locks in more profit ahead of the event. There’s always a trade-off, and with NFP, I thought I’d go for a bigger profit than lock in what I already had because of how good U.S. data has been. In hindsight, that was the lower return move to make, but in the same situation in the future, I’d go with the same adjustments every time.
At any rate, it’s still a win going into the weekend, and with the Greenback pulling back, I’ll look to the charts and economic data to see whether this might be a new opportunity to jump in more Greenbacks after the weekend. Stay tuned and have a great weekend!