Pick of the Day: EUR/USD – Close Trade

Stop Adjustment: 2008-10-10 11:22

Good morning! With the Euro/US overlap coming to a close and my second profit target being hit, I’ve decided to pack it up for the week and bank my profits. With the G7 meeting going on this weekend and the continued crazy volatility, there’s no reason to try to ride this trade further down further and be in a position over the weekend.

Closing remaining position at market (1.3475).

1st Half: +85 pips
2nd Half: +270 pips
Total: +2.09% gain

So a great end to very profitable week. I hope everyone has a great weekend!

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Stop Adjustment: 2008-10-09 21:53

Just a quick update and adjustment as EUR/USD has moved lower, and I would like to readjust my stop to lock in pips on my remaining position.

Adjust stop on remaining position from breakeven to 1.3660 to lock in +85 pips on remaining position.

It looks like we’re seeing more risk aversion in Asia after equities and carry trades in the US have another down day. I look to continue to hopefully ride the pair lower and trail my stop along the way. Stay tuned!

Trade Adjustment: 2008-10-09 11:30

It looks like price action in EUR/USD went my way during the Asian and European trading sessions as the pair rallied up to the resistance area and quickly found sellers to push the pair lower. My trade was triggered and my first profit target was hit.

Half trade closed at 1.3660 to lock in +85 pips. Adjust stop on remaining position to break even to create a risk free trade. Trailing stop on remaining position by 85 pips.

The pair is currently testing the rising trendline drawn on the chart, so let’s see if the pair can break it and push lower. Stay tuned!

Trade Idea: 2008-10-09 00:19

PoD Chart

Gonna keep it easy tonight with a short term play on EUR/USD. The pair has been marching higher after hitting a low around 1.3450, and now approaching the possible resistance area marked on the chart. This area may be watched by traders as a possible selling point, and with the pair in a longer term downtrend I like the probability of success on a short play.

Before I go into my plan, let’s take a quick look at the fundies.

Of course, the event of the week so far has been the coordinated interest rate cut from five central banks yesterday, including the Fed and the ECB. While it sparked off a bit of volatility and a short rally in risk appetites, this just gave traders an opportunity to sell the longer term sentiment that the Euro has further to fall and the perception of the US Dollar as a “safe haven” during this credit crisis and global recession. I think traders will continue to play on that idea as all that has been done so far is not a quick fix and that there is much more deleveraging and pain to go through for the markets.

So, risk averision is still in play and here’s what I’m going to do if EUR/USD finds it’s way to the potential resistance area:

Short EUR/USD at 1.3745, stop at 1.3830, pt1 at 1.3660, pt2 at 1.3475

Remember to never risk more than 1% of a trading account on any single trade. Adjust position sizes accordingly.

We do have event risk with US unemployment claims being the major news of the day at 1230 GMT. Please be extra cautious around that time. Good luck and good trading!

  • clockwork

    On the nose…. Good pick

  • clockwork

    On the nose…. Good pick

  • Pipcrawler

    Thanks for the comment clockwork… I get lucky sometimes :)

  • Pipcrawler

    Thanks for the comment clockwork… I get lucky sometimes :)