Pick of the Day: USD/JPY – Trade Closed

Trade Closed: 2007-11-28 10:20

Our short position has closed as it looks like carry traders return to the market and sell the Yen all the way to 110.00.

We adjusted our position yesterday as the market appeared to find support at 107.50 by closing half our position and adjust our stop to break even.

1st Half: +50 pips
2nd Half: +00 pips
Total: +50 pips

So, we ended up profitable, but missed out on more profits as we were up by about 150 pips at one point. No worries though. It’s another aspect of our trading plan to analyze and hopefully improve on.

Stay tuned as I may have a short on Cable idea this afternoon. See ya soon!

Trade Adjustments: 2007-11-27 12:15

It’s been a wild ride for our position as the USD/JPY has made strong swings in between 107.00 and 109.00. With the pair finding strong buying support at 107.50, I feel we may see a short term reversal into the holiday season.

So, we will lock in a few pips by closing half of our position at market (108.50) to lock in +50 pips. Adjust the stop on the remaining position our entry at 109.00.

Good luck!

Trade Update: 2007-11-26 09:12

Greetings Everyone! Just a quick update on our short position in USD/JPY. At the end of the week, our short orders were triggered at 109.00 and the pair made a move lower as 109.00 held as resistance.

The pair dropped below 108.00 during the US holiday, but it looks like its back up trading around 108.20, putting us about 80 pips in the black.

I will continue to watch and hold for now. Stay tuned for updates and possible trade adjustments. Good luck!

Trade Idea: 2007-11-21 09:30

PoD Chart

Greetings everyone! I’m just about out of here for the extended US holiday, but before I go I thought I’d throw out one last trade for the week. Let’s take a look at USD/JPY…

USD/JPY has had a strong correlation with equities for a while now as movements in Yen have been dictated by global risk appetite. In my view, as technology brings interrelated markets closer together, this relationship will only tighten as time goes along.

With that said, as equities continue to take a slide I see a further reduction in risk which means more carry trade unwinds and the buying back of the Yen. This trend is already in motion, as the pair has fallen from 123.00 back in June, and with a break of support at 109.00, it will probably continue as traders offset risk against the carry trade undwind.

A couple of other things to consider is affect of high commodity prices (especially oil) on equities earnings and the consumer, overall sentiment of Dollar weakness, and a possible Fed cut coming in December.

So, we are at an important inflection point in this market and with the 4hr chart, and possibly the daily and weekly chart, closing below 109.00 I am shorting this pair for a longer term trade.

As for my entry, I’d like to see a pull back to around 109.00 before entering to lock in a slightly better price and I will have a wide stop of about 200 pips to get me out in case the trade becomes invalid.

Short USD/JPY at 109.00, stop at 111.00, pt1 at 107.00, pt2 at 105.00

Remember to never risk more than 1% of your account on any single trade. Adjust your position sizes accordingly. Also, if the market does reach 105.00, we will adjust stop on remaining position to 107.00 and go for 103.00

As with any longer term trade, I like to scale into my positions little by little. You may want to try that with this trade as we may or may not hit 109.00 again. Just remember that your overall position risk should never be more than 1% of your account. Got it?? Good! :)

Stay tuned for updates and trade adjustments and with it being Thanksgiving Day tomorrow I would just like to give thanks to all of our members and visitors here on BabyPips.com. Our goal has always been to get new traders started off on the right foot and without everyone’s support, it couldn’t have been possible. Thanks everyone, good luck and good trading!

2 comments

  1. nytrader1958

    pip very good trade. I have been short since sept i got in at 117.50. I am expecting to see 104 before a turn around. I dont see any support til then on the monthly chart.

    Reply
  2. nytrader1958

    pip very good trade. I have been short since sept i got in at 117.50. I am expecting to see 104 before a turn around. I dont see any support til then on the monthly chart.

    Reply

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