Pick of the Day: USD/CHF – Trade Closed

Trade Closed: 2007-08-13 09:30

After locking in profit on the first half of our position on Friday, the Greenback rallied against the Swissy to close out the remainder of our position at breakeven.

Dollar bulls have been benefiting in the past few trading sessions as market players flock to the Greenback for protection from the current panic in the market caused the “credit crunch.”

So, our trade closed out only banking on the first half of our position. Still not bad…I hope everyone did well!

1st half: +30 pips
2nd half: +00 pips
Total: +30 pips

Trade Adjustment: 2007-08-10 08:40

Our trade finally took off as the Dollar sold off against the Swissy during the morning European trading session to hit our first profit target and beyond.

The pair hit a low of 1.1928 before retracing back up to around 1.1950. Half of our position was closed at 1.1950 to lock in profit and the stop on the remaining position adjusted to breakeven.

We may see more Carry trade liquidation as traders reduce risk going into the weekend, so we will hold our position to go for max profit target at 1.1920. Good luck!

Trade Update: 2007-08-09 09:45

It appears the sub prime mortgage issues in the US has affected institutions across the globe spurring carry trade unwinds and some USD buying.

Our short entry at 1.1980 was triggered as the USD rallied, but now trading slightly below our entry point. This trade looks good to go, so we will hold on for now. Please stay tuned for updates!

Trade Idea: 2007-08-08 22:50

PoD Chart

Today we will look at a nice chart setup on USD/CHF!

The pair has been on in a downtrend for a couple months now, but we saw a strong rally recently as traders flocked to the Greenback away from riskier assets. This retracement may be an opportunity to jump back into the downtrend.

Fundamentally, USD has been hurt as the US economy is expected to see more weakness from housing data, as well as threats that China may sell some of its foreign reserves (much of which is in US assets).

On the chart, we can see the 240 MA’s trending lower, stochastics coming out of overbought territory, and the pair found resistance at the 61% Fib level. I’d like to go short if it hits that level once again…

Short USD/CHF at 1.1980, stop at 1.2030, pt1 at 1.1950, pt2 at 1.1920

Remember to never risk more than 1% of your account on any single trade. Please adjust your position sizes accordingly.

Good luck and good trading!

  • swordofrue

    Fundamentally it sounds good, and also technically! It looks like a great opportunity to short. I would be one to wait for the turn down before I would short, just my style. If it where close below 1.1935 I would totally short it. Good eye crawler :)

  • pigactor

    Hey Pipcrawler,

    I see that the Consumer Climate is forecast to go up. Will that bump Swissy up to 1.1980 to activate our short? (Is Consumer Climate a big enough deal to push Swissy up to our stop loss or is it not a big deal?)

    Interested in your analysis before I put in my order.

  • pigactor

    Ok, well the Consumer Climate survey is out. According to Forex Factory, it was previously at 20, it was forecast to go up to 23, but instead it fell to 15. Is this good for us or bad for us?

  • swordofrue

    Fundamentally it sounds good, and also technically! It looks like a great opportunity to short. I would be one to wait for the turn down before I would short, just my style. If it where close below 1.1935 I would totally short it. Good eye crawler :)

  • pigactor

    Ok, well the Consumer Climate survey is out. According to Forex Factory, it was previously at 20, it was forecast to go up to 23, but instead it fell to 15. Is this good for us or bad for us?

  • Pipcrawler

    Hey Pigactor,

    I never really considered Swissy news as market moving, so I really don’t pay much attention to them. But our trade looks good now as I think further carry trade unwind and the long term bearish dollar sentiment will be in play now.

  • Pipcrawler

    Hey Pigactor,

    I never really considered Swissy news as market moving, so I really don’t pay much attention to them. But our trade looks good now as I think further carry trade unwind and the long term bearish dollar sentiment will be in play now.

  • FXRYAN

    I made 20 pips on this trade and I’m looking to get in short again for the the next few days.

  • FXRYAN

    I made 20 pips on this trade and I’m looking to get in short again for the the next few days.