Bahh, stopped out! AUD/NZD eventually broke above that channel resistance zone I thought would hold. So much for expecting the Kiwi to get its wings back!
Before reading on and helping me figure out what I could’ve done better, make sure you take a look at my initial trade idea first.
When I shorted AUD/NZD back then, I was crossing my fingers that traders would be drawn back to the higher-yielding Kiwi sooner or later, as it offers positive carry against the Aussie. However, the RBA recently dropped its dovish bias while the Kiwi got weighed down by weak dairy prices, allowing the pair to break past the channel resistance.
In retrospect, I can see a few instances when I could’ve exited early. For one, a short-term triangle formed right around the 1.1000 major psychological handle, with the upside break serving as a signal that more rallies are in the cards. I could’ve closed at the break of the consolidation around the channel resistance also instead of just waiting for price to hit my stop at 1.1125.
Here’s the damage:
P/L: -150 pips / -0.5%
I guess wishful thinking got the best of me, huh? I just couldn’t shake off my bullish Kiwi bias quickly enough! Think I should close my EUR/NZD short early as well? As always, I’d appreciate getting feedback from you guys!
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