Forex Trade Adjustments: Short EUR/NZD

Looks like my patience is finally paying off on this EUR/NZD short forex trade! After WEEKS of consolidation and a few close calls, price finally showed downside momentum after it broke below the short-term support around 1.5730.

EUR/NZD 4-hour Forex Chart

EUR/NZD 4-hour Forex Chart

A few days back, I had been feeling frustrated that I chose to short this pair instead of EUR/CAD or EUR/AUD – both of which had sharper declines recently. It appeared that the euro and the Kiwi were similarly weak, as the ECB appeared ready to ease further while the New Zealand economy printed bleak data. However, I decided to hold on mostly because of the positive carry and my bias that the Kiwi is still fundamentally stronger than the euro.

Now that the pair looks ready to head further south, I’m considering adjusting my stop a little lower prior to the ECB rate decision this week. I’m also thinking of adding on a pullback to the 1.5730 broken support zone or on a strong break below the 1.5700 mark. I still plan on aiming for the previous lows near 1.5400 first but I’m open to aiming for new lows, depending on how the ECB statement turns out.

What do you guys think?

Cheers!

Happy time

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  • ForExchange

    Hi HappyPip!

    Great that your trade goes into the right direction! I also like the pullback idea to add to your position. Carry is also in your favor looks good. I traded EUR/AUD rather and turned out great.

    The one practice I do not use only is adjusting the stop even the ECB Statement. I either close my trade before the Statement or believe in it in the long-term. If you believe it goes against you, close it. If you believe it goes in your direction then it does not make sense to close it IMO because it might still spike up against you, close you out from the trade and still go south. But it is only my thinking.

    Good luck!

    • Thanks for boosting my confidence, haha. Looks like the weak NZ dairy auction is weighing on the Kiwi once more for now though so I’m a little worried again. Yep, I might keep my original stop around 1.6000 for now since price is moving above my entry area before the ECB statement. Congrats on your EUR/AUD trade!

  • UPANDDOWN

    Looks like it was 200 pips rather you traded CAD, AUD, or NZD against EUR

    • Yeah I still wish I was able to short EUR against AUD or CAD, but I’ll take these profits from NZD any day haha!