Close Open Orders: 2008-07-02 15:47
With the US Employment data and the holiday weekend approaching in the US, I have decided to close my open orders in AUD/USD. It’s another frustrating trade idea as we were right with direction, but too conservative on entry as our orders to go long at .9500 were missed by a mere 15 pips.
Close Open Orders. No trade.
Trade Update: 2008-07-01 15:33
Hello! Just a quick update as our orders still remain open. AUD/USD continued to fall today starting in the Asian session after the RBA kept rates at 7.25% and further throughout the Euro/US overlap on positive US data surprise.
The market is consolidating now, so probably no action for the rest of the day and I will continue to keep my orders open at .9500. Stay tuned for future updates and adjustments!
Trade Idea: 2008-06-30 12:05
Fundamentally, the Aussie’s huge positive interest rate differential and strong commodity correlation continues to make it more attractive than the Greenback. Unless we see Asia’s demand of Australian commodities dwindle (which probably won’t happen in the short term), the market may continue to price the pair to parity. We do have plenty of Australian event risk as we have retail sales, housing, and trade balance data coming out throughout this week, along with the RBA interest rate decision tomorrow. Speculation is that the RBA will hold at 7.25%, even with rising inflation, as global growth continues to slow. In the US, it’s Jobs data time and with the underlying trend of job losses in the US, it doesn’t look good for the Greenback.
With so much data this week, we should get enough volatility to get us in at a better price on the rising AUD/USD trend. Today’s positive surprise on the Chicago PMI report has brought the pair back below .9600. I think after the nice rally the pair has had, we may see further retracement lower on profit taking as traders take some money off the table ahead of NFP data. I like the 50% Fibonacci retracement level as i build my long AUD/USD position around that. Here’s a short term swing idea based on today’s analysis:
If our trade is triggered and we do hit our first profit target, look for an update to add a trailing stop to hopefully catch a run higher. Good luck and good trading!