AUD/USD: Simple Retracement Play – Trade Review

So much for a risk-free trade! Turns out slippage didn’t work out in my favor and I chalked up a tiny loss with this AUD/USD short.

As I mentioned in my trade adjustments blog update, I closed half of my position ahead of the FOMC event and moved my stop to entry on the remaining position. However, when volatility picked up and price spiked up the next day, I noticed that I got stopped out a few pips above my adjusted stop loss!

audusd

With that, I ended up with a tiny dent on my account instead of the small gain that I had expected. Guess you really shouldn’t count your chickens before they’ve hatched, huh?

Although risk aversion is still in play and data from China has shown signs of weakness in both manufacturing and non-manufacturing sectors, it appears that traders booked profits ahead of the Chinese New Year long weekend and triggered a quick bounce for this pair. Do you think the selloff will resume soon though?
Cheers,

Happy time

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