Trade Review: 2011-04-26 22:20
Unfortunately, that was pretty much it for the day as the pair stayed rangebound through the remainder of Tuesday’s trading session. So, I decided that was it for my day trade and that it was time to look for a new opportunity so I manually closed at 119.70.
Total: -20 pips/ -0.25% loss
In retrospect, the I could have been more conservative with my entry by waiting for EUR/JPY to test the top DATR/PDH area (119.80 – 120.00). I don’t really feel any regret about my entry because I saw strength as it went lower and went aggressive with that.
Trade Idea: 2011-04-26 4:14 ET
On the 15m chart above, we can see EUR/JPY has been in a downtrend since topping out at 120.00 on Monday. After breaking yesterday’s lows, the pair has bounce higher to retest PDL, as well as 61% Fib level and WO. Finally, stochastics are showing overbought conditions, signaling the bounce higher may be running out of steam.
After a strong run up in risk taking, it looks like traders are ready to take profit this week, especially ahead of major events like UK and US preliminary data, Aussie CPI, and the big event of the week, the FOMC interest rate decision (Be sure to check out the Forex calendar for release times). It makes sense to take some off the table ahead of events that could wipe out your profits very quickly.
So, I look to do an intraday short on EUR/JPY, but not until it reaches the MiPs level of 119.50. My stop will be 80 pips (half daily ATR) and above the PWH (120.40), and my profit target will be just below the next MaPs level of 118.00. Here’s what I am going to do:
Stay tuned for updates and adjustments on my Twitter and Facebook pages. Thanks for checking out my blog!