Trade Update: 2011-09-02 06:03
Oh no, not again! My trade was going so well but it ended up getting stopped out. And here I thought that the top weekly ATR and the previous day high was already broken.
As it turned out, the 1.0750 handle was just too strong a resistance for the pair. Good thing I was able to move my stop to breakeven just in time!
It’s probably all for the best. I didn’t plan on holding on to this trade until the non-farm payrolls release because that could lead to some wild dollar moves. Plus, I did mention that this long AUD/USD trade was meant to be just a day trade.
Still, I can’t help but wish that I was able to make a few profits on this trade instead of ending up with absolutely nothing at all. Then again, thank goodness for proper risk management and I was able to avoid another dent on my account.
How could I have played this setup better? Should I have just stuck with my original short trade idea? Let me know what you think!
Trade Update: 2011-09-01 6:500
After seeing poor ADP figures from the U.S. and better than expected Australian retail sales data, I decided to switch sides and go long AUD/USD instead. Hey, a girl’s entitled to change her mind, right? I’d like to call it BEING FLEXIBLE, ha!
Just like in cheerleading, it’s important for a trader to be flexible. But don’t fret; it’s not as impulsive as you might think.
A few hours ago my Twitter friends and I watched Australia’s retail sales and capital expenditure report. Since the U.S. ADP report printing only a bit better than expected, I figured that Australia’s reports might provide more volatility for the pair.
And what do you know – Australia’s reports actually came in better than expected! Retail sales went up by 0.5% in July, the first in three months, while the seasonally-adjusted private capital expenditure ticked 4.9% higher in the second quarter. Adding to that the Chinese PMI report that missed expectations by just a hair’s breadth and we got ourselves a comdoll frenzy!
Okay, maybe not exactly frenzy, but it’s enough for me to buy at market! I got in at 1.0690 at the release of the report, and now I’m just waiting for the pair to clearly break yesterday’s high and the top weekly average range (around the 1.0720 area) before I think of adding to my position. In any case, I’ve already moved my stop loss to break even when the pair reached 1.0732 a couple of seconds ago.
Do you think my plan has merit? It’s been so long since I have won an AUD/USD trade so I’m watching this one closely. Don’t hesitate to put up your advice, okay? I’m sure I’ll appreciate it!
Waiting to hear from you,
Trade Idea: 2011-08-31 6:22
I think I need to muster the guts to trade this comdoll pair that hasn’t exactly been good to my account. Yep, that’s right, I’m trading AUD/USD again! Check out my short trade idea and tell me what you think:
I spotted a nice technical setup on the pair’s 4-hour chart as it neared the top of its average weekly range. Stochastic has already been in the overbought area for quite a while now, with a bearish divergence to boot! To top it all off, there seems to be a rising wedge on the same time frame and the upper trend line is right in line with the 1.0700 major psychological handle.
With a sweet deal like this, what’s a girl to do? Should I give in and short this pair right now?
Of course not. I decided to be a little more careful and figure out whether there are any economic catalysts that could mess up my short trade idea. Lo and behold! The economic calendar showed that there are three event risks for the Aussie tomorrow namely the Chinese PMI, Australian private capital expenditures data, and Australian retail sales.
All three reports are projected to post improvements over the previous month’s figures but, if we see worse than expected results, AUD/USD could be in for a strong midweek reversal.
I’ll also be keeping close tabs on U.S. economic data, such as the ADP non-farm employment change and the ISM manufacturing PMI. Would another round of disappointing U.S. data trigger risk aversion? Well, we’re about to find out soon, aren’t we?
So, are you with me on this trade or do you think I should tweak a thing or two in my plan?
I plan to jump in a short trade at market IF AND ONLY IF the reports tomorrow come in below consensus. I’ll be aiming for the week open price (1.0575) for my first profit target and I’ll trail my stop on the remaining position.
Since adding to my position didn’t work so well in my past two trades (USD/CAD and NZD/USD), I probably won’t do that again for this trade. Still, with a 75-pip stop, my potential reward-to-risk ratio is looking really sweet!
Looking forward to talking to ya!