Trade Closed: 2008-08-27 10:11
My short position triggered and the resistance area held out for most of the European trading session, but a rise in oil and hawkish comments from ECB council member Axel Weber momentarily pushed EUR/USD passed the potential resistance area to my stop at 1.4750.
Total: -50 pips/ -1.0% loss
So, a small loss for the day, but the week has the potential for more volatility and trade opportunities. Stay tuned!
Trade Idea: 2008-08-26 21:34
Yo Yo! After a bit of consolidation, EUR/USD broke rising support today after German business confidence and Ifo Business Index came in weaker than expected. During the US trading session, the Euro found a bit of relief as a rally in oil prices pushed the Greenback down, giving the EUR/USD market a boost. This may present a new opportunity to jump into the US Dollar rally and see if we can ride the pair lower.
As we can see on the chart, after the break, the pair has retraced back to the rising trendline…support turned resistance maybe??? I would like to short around this area as I feel we may continue to see further downside once again on the sentiment that the ECB will have to cut rates eventually to handle the slowdown that is starting to affect the Eurozone.
We do have event risk tomorrow with US Durable Goods Orders and Crude Inventories numbers. Another spike up in crude prices could hurt the Greenback, as well as weakness in Durable Goods.
Short EUR/USD 1.4700, stop at 1.4750, pt1 at 1.4650, pt2 at 1.4450
Remember to never risk more than 1% of your account on any single trade. Adjust position sizes accordingly.
Stay tuned and good luck!