Trade Closed: 2008-01-17 12:59
The remaining portion of our trade has closed as AUD/USD found support at .8750 and rallied from there to our adjust stop at .8805.
1st half: +79 pips
2nd half: +149 pips
Total: +228 pips/ +1.5% gain
So, with a little patience and faith that Gold was overbought and that .9000 would hold for the Aussie, our trade worked our in our favor and we took a nice small profit.
The recent rally may be a short term retracement from a further move lower. I would continue to expect the Aussie to move lower on risk reversion and Gold/commodity weakness. Stay tuned for new trade ideas!
Stop Adjustment: 2008-01-16 11:11
As we near the close of the European trading session, I’d like to make a trade adjustment before I end my trading day.
Adjust stop on remaining position to .8805. Adjust profit target to .8710
Again, gold is now hanging out below $900 and now we just saw a sell off on the Euro which may help push up the value of the US Dollar on a broad base. I look for the pair to fall a bit further as we may see more risk reduction. Stay tuned!
Trade Adjustment: 2008-01-15 16:29
The Aussie has just kept falling since our last update, now approaching the .8800 handle. We will do another trade adjustment to lock in more profits on this trade.
Adjust stop from breakeven to .8875 to lock in +74 pips on our remaining position. Adjust profit target to .8750.
With gold falling back below $900 and a change in sentiment in commodities as demand is projected to slow, we may see the pair fall further. Stay tuned for more possible adjustments. Good luck!
Trade Adjustment: 2008-01-15 11:43
After a few days of waiting, we are now seeing a drop in the Aussie on strong US Dollar demand and speculation that commodity demands may be taking a step back according to the Baltic Dry Index.
Patience has paid off as .9000 held, then the pair dropped all the way below the .8900 handle and hit our first profit target. So, we have locked in a few pips and we will adjust our stop on the remaining position to breakeven to create a risk free trade.
Stay tuned for more updates as we may adjust our profit targets depending on the news and how far momentum will take it.
Trade Update: 2008-01-14 08:25
Hello! Our trade has been on a rollercoaster ride once again as the pair opened the trading week just a few pips above our first profit target before rallying on Dollar weakness and gold strength.
There was speculation that we would see resistance for gold at $900/ounce, but that may not be the case as the precious metal touched just below $915. With a weaker Dollar and stronger gold, the Aussie was pushed up away from our first profit target at .8875 all the way up to .9000.
I think i will continue to play this trade out to see if .9000 holds and to see if gold does stay above $900. If not, we could see a big drop down on profit taking and risk aversion. Stay tuned for updates!
Trade Idea: 2008-01-10 17:06
Greetings! We have a short term, technical play on the Aussie as we just saw a strong move today on surging gold and rate cut speculation. This move was a bit fast, so we may see a small pull back in the short term.
Gold has been hitting all time highs, almost hitting $900. This has been great for the Aussie, but we may see a bit of resistance and pull back around this area for the precious metal. Because of the strong correlation between gold and the Aussie, we may see the Aussie pull back as well.
Technically, the 240 MA’s have been trending sideways indicating a ranging market. Also, the pair is trading at the outer bollinger bands, so we may see a return to the MA’s from this point. And finally, stochastics are trading above 80 indicating the pair may be overbought.
So, we will short from here and hopefully catch a few pips, ultimately targeting the 240 MA’s.
Short AUD/USD at market (.8954), stop at .9030, pt1 at .8875, pt2 at .8800
Remember to never risk more than 1% of your account on any single trade. Adjust position sizes accordingly.
Good luck my friends!