Close Trade: 2008-06-03 15:20
Looks like I’m going to have to shut this trade down as Bernanke’s comments has signaled an end to the rate cuts and the Fed’s focus on the US Dollar weakness. This should support the Greenback, at least in the short term, which doesn’t bode so well for our trade.
Total: -100 pips/ -0.50% loss
Trade Update: 2008-06-02 08:45
It appears risk aversion is on play today after Bradford & Bingley Plc, the U.K.’s biggest mortgage lender to landlords, said it needs to raise more capital because of “widening bad-debt provisions.” So, more credit concerns has brought risk appetites down, including carry trades.
USD/JPY is back below 105.00, and with the economic calendar pretty full this week, we may see a further decline if data continues to weak. I will hold onto continue this position and closely watch this weeks data.
Stay tuned and good luck!
Trade Idea: 2008-05-22 11:42
While we saw positive US data today, I still feel that the economy has a long way to go before we see any kind of improvement from the fallout of the credit crunch. According to the FOMC meeting minutes, the Fed agrees with me and I think traders will be short bias on the Greenback for sometime to come, even if the Fed rate increases have stopped.
I used a Fibonacci retracement tool to find possible resistance points, and I like the 104.00 area as it lines up with the 50% Fibonacci retracement level. I’m going to short at market (104.00). I’m also going to make this a longer term trade with wider stops, and adding trailing stops if we hit our first profit target.
Stay tuned to updates, good luck, and good trading!