Is it just me or is the Kiwi having trouble extending its slide? This might be a sign of a short squeeze so I’m taking my profits from here!
In my earlier trade update, I mentioned how I decided to re-enter on a break of the pre-NFP lows as bearish momentum was still present. I kept my original profit target just slightly above the .7000 major psychological mark, thinking that hawkish FOMC minutes might be enough to push price to that area.
The FOMC minutes turned out mostly upbeat alright, but renewed hopes of a November hike or stronger odds of tightening in December didn’t seem to be enough to push NZD/USD on another sharp decline. Policymakers said that the September decision was a “close call” as many acknowledged that the case for a hike has strengthened, but the pair seemed to be trying to stay above the .7050 area.
Because of that, I just decided to take whatever profits I had on this second position instead of leaving it all on the line. My target was pretty close by anyway, and I couldn’t bear the thought of potentially losing these gains on a sudden pullback.
Here’s what I ended up with:
1st position: +100 pips / +0.42%
2nd position: +75 pips / +0.12%
TOTAL: +175 pips / +0.54%
I know, I know… I could’ve made much more had I just kept my original position open and held on until the current levels. I would’ve caught an additional 50 pips if I didn’t close ahead of the NFP, which would’ve added around 0.20% to my gains, but I’m still pretty happy with how I managed this trade given all the major event risks to the dollar then.
Got any comdoll trade ideas you’d like to share? Post ’em right here! And don’t forget to check out our risk disclosure when taking any of these setups.
See also: Q2 2016 Trading Performance Review