Pick of the Day: USD/JPY – Close Open Orders

Close Open Orders: 2008-09-29 18:26

The US Congress failed to pass the $700B plan today, leading to risk aversion and a sell off in USD/JPY. It’s highly improbable that we will see my short orders triggered at 107.50 as the outlook for the Greenback and US interest rates are speculated to fall.

So, I will close my open orders to short USD/JPY at 107.50 and look for another short entry point soon.

Close Open Orders. No trade.

So, further pain for the Greenback and carry trades? Probably so in the short term. Be cautious and stay tuned!

BabyPips.com USD/JPY Forums
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Trade Update: 2008-09-24 13:46

It’s been a few days since I posted my thoughts, and no luck in getting triggered as the markets have been calm. This is mostly a result of traders hanging on the sidelines as they wait the outcome of the US hearings on the $700B bailout plan being proposed this week. So, expect more “Zzzzzzzzzzzzzz” until we see the decision on whether or not the plan will pass.

So, I will continue to leave this orders open for now, but look for some short term range plays, probably for the rest of the week. Stay tuned!

BabyPips.com USD/JPY Forums
Don’t forget to check out Forex news at Freshpips.com!!

Trade Idea: 2008-09-22 12:39

PoD Chart

What’s up my Forex friends! I’ve got a few thoughts on USD/JPY to start the week of on with an idea that go from a swing trade to possibly a longer term position. Let’s take a look….

First, let’s take a quick look at 4 hour chart on USD/JPY. We can see that the falling trendline has held pretty strong since the end of August and the pair quickly reversed after touching it last week. I am short biased for fundamental reasons which I’ll touch upon in a sec, so if we see price action take the pair back up to the trendline, I’ll look to enter a short position there.

Fundamentally, all markets are getting pushed around by what’s happening in the US as the government continues to throw hundreds of billions at the credit crunch to avoid a financial meltdown. This provided a boost to risk appetites last week, but will it continue? Will liquidity return to the markets? Are traders’ confidence in the system returning? Well, it looks like traders aren’t too sure as we are back to selling equities today and as money pours into commodities, like gold and oil, for a safe haven – not so good for the Greenback.

Even bigger than that is the affect of taxpayer money to fix the crisis and the amount of debt added to the balance sheet of the US government. How attractive are US assets in the medium to longer term with this increased debt? Will we see taxes raised in the US and will it affect the consumer?

There really isn’t anyone out there who knows what’s going to happen next, but what I think is that we are experiencing extraordinary events in the markets and this level of uncertainty could bring further rounds of risk aversion. Carry traders may continue to slowly deleverage until we see a bottom, which possibly means further movement lower for USD/JPY.

Based on my view of the fundies and the chart, here’s what I’m going to do:

Short USD/JPY at 107.50, stop at 108.50, pt1 at 106.50, pt2 at 105.50

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

If my position is triggered, and if the second profit target hits I am going to leave it open and use a 100 pips trailing stop to see if I can catch a run down further.

So, let’s see if I can get a favorable price on this idea. Stay tuned for updates!

  • enochbenjamin

    hmmmm… short at 107.50 – I am already short with 100+ pips. I don’t like to hate on other traders, but I sure don’t want to see this puupy retrace to 107!!

    but, if it does, I will be reloading with you!!!

  • Pipcrawler

    Yeah, it’s a very conservative….for those who can, it may not be a bad idea to scale in between 106.00 to 107.50. Meaning, enter with portions of your overall position size at various points between those prices, but stay within risk tolerance if stopped out!

  • enochbenjamin

    hmmmm… short at 107.50 – I am already short with 100+ pips. I don’t like to hate on other traders, but I sure don’t want to see this puupy retrace to 107!!

    but, if it does, I will be reloading with you!!!

  • Pipcrawler

    Yeah, it’s a very conservative….for those who can, it may not be a bad idea to scale in between 106.00 to 107.50. Meaning, enter with portions of your overall position size at various points between those prices, but stay within risk tolerance if stopped out!

  • davyy

    Hey, I think that 106.90 serve as a strong resistance in the hourly chart, and breaking it would trigger the usd/jpy to rally again, 107.50 is far and reaching it needs a very high momentum as i think that the usd is in a corrective rally and will soon start to fall again but is the usd/jpy gonna reach 107.50???????
    we will c :) good luck to all of us

  • davyy

    Hey, I think that 106.90 serve as a strong resistance in the hourly chart, and breaking it would trigger the usd/jpy to rally again, 107.50 is far and reaching it needs a very high momentum as i think that the usd is in a corrective rally and will soon start to fall again but is the usd/jpy gonna reach 107.50???????
    we will c :) good luck to all of us

  • delbertino

    I appreciate this so much. I left two short trades for USD/JPY for opening last week; Damn! In three minutes I cashed-out five for $440 each. I decided screw the demo account I’m goin’ long with my bias for JPY and Aussie. This week is different. Sideways. But at some point you are right. If anyone knows, its the economist.

  • delbertino

    I appreciate this so much. I left two short trades for USD/JPY for opening last week; Damn! In three minutes I cashed-out five for $440 each. I decided screw the demo account I’m goin’ long with my bias for JPY and Aussie. This week is different. Sideways. But at some point you are right. If anyone knows, its the economist.

  • Pipcrawler

    thanks everyone! I really appreciate the comments! delbertino, did you just refer to me as an “economist?” I’m offended!! jk :)

  • mstory

    Just subscribed to Pick of the day.
    Looking forward to following your trade ideas.
    Looks like this descending trend line on USD/JPY has paid out several times for you…………..hope it continues now that I am paying attention.

  • Pipcrawler

    thanks everyone! I really appreciate the comments! delbertino, did you just refer to me as an “economist?” I’m offended!! jk :)

  • mstory

    Just subscribed to Pick of the day.
    Looking forward to following your trade ideas.
    Looks like this descending trend line on USD/JPY has paid out several times for you…………..hope it continues now that I am paying attention.

  • fed

    I am still waiting for the 107.50 mark, or i am not entering in, unless if I see a movement

  • fed

    Pipcrawler thanks for your hard work by the way :)

  • fed

    I am still waiting for the 107.50 mark, or i am not entering in, unless if I see a movement

  • fed

    Pipcrawler thanks for your hard work by the way :)

  • fed

    Pipcrawler did you enter in to this trade yet? or are you waiting for 107.5 mark?

  • Pipcrawler

    Thanks for the comments everyone. No I haven’t entered as I’ve pretty much been staying away from swing positions during this whole bailout debate this week. The markets aren’t really moving much, so I’ve just been scalping here and there and planning for a possible monster move when we see whether the bailout plan in the US gets passed or not. Stay tuned!

  • fed

    Pipcrawler did you enter in to this trade yet? or are you waiting for 107.5 mark?

  • Pipcrawler

    Thanks for the comments everyone. No I haven’t entered as I’ve pretty much been staying away from swing positions during this whole bailout debate this week. The markets aren’t really moving much, so I’ve just been scalping here and there and planning for a possible monster move when we see whether the bailout plan in the US gets passed or not. Stay tuned!