There are times when you just gotta know when to call it quits, and this is one of them. I decided to close my USD/CAD swing forex position completely before price hit my stop. Before reading on, I suggest you take a quick look at my initial idea first.
In my latest update, I mentioned that I already exited half my position at 1.3375 in order to trim my potential losses while still having some skin in the game. At that time, I was counting on the BOC statement to spur a quick bounce or for crude oil prices to tank and allow me to close the rest of my trade at a much better price. Unfortunately, that wasn’t the case last week so I decided it was time to walk away.
Besides, it looks like the pair already made a pretty legit break below the long-term rising trend line I had so the technical signals were invalidated as well. Not even the downbeat Canadian jobs report was enough to trigger a sharp Loonie selloff, which means that the currency is still strongly supported by speculations of a potential output cut.
With no signs of a possible agreement among oil producers until now, I’m still long biased on this pair, but I might have to wait for a much better entry point or actual signs that another crude oil selloff is about to take place. For now, here’s what I got:
P/L: – 400 pips (average) / -0.42%
Even though I’m hurting from this trade, I’m still gonna give myself brownie points for reducing my losses and for being patient enough to stick to this position for weeks. I just wish I picked the right pair and direction!
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