Trade Closed: 2010-04-20 23:20
With the pair just bouncing around a tight 100-pip range, it looks like my initial trade idea playing on the Fibs is now invalidated. Needless to say, I’ve decided to close my trade at roughly breakeven to minimize risk. I’m still looking to go long on the comdolls though, and I’m keeping my eyes peeled for possible ways to buy them up.
Closed at 0.7102: -9 pips / -0.11%
So I took a small loss, but I think it’s the correct move, so there’s no reason to be unhappy! Besides, there will always be many opportunities – I just have to wait for the best setups!
Last week, risk sentiment picked up as news regarding Greece’s debt issues were somewhat put to rest when they receive a bailout package from the EU and IMF. This boosted risk appetite, which sent higher yielding-currencies soaring.
Volatility has died down a bit recently though, with very few high impact reports released so far… but I think this could change today. I took a look at the economic calendar and it looks like we’ve got the consumer price index and retail sales reports from the US coming out tonight at 12:30 am GMT.
The CPI report is expected to show an increase of 0.1% in consumer prices in the past month, which would imply that inflation in the US remains subdued. Meanwhile, headline and core retail sales are projected to show growth of 1.1% and 0.5% respectively. As Pip Diddy pointed out in his post today, we may just see some better than expected figures, as in improvments in the labor market and local demand may have given a boost to consumer spending in March. Besides, the winter season is over, so there was no bad weather to fight off – ha!
Looking at the NZDUSD’s recent price action, I noticed that it has corrected back to the 50% Fibonacci retracement level after reaching a high of 0.7195. The pair has a bullish bias since it just broke a falling trendline.
With the stochastics in the oversold area, traders could soon pick and buy up the pair. Moreover, the presence of a spinning top right at the 50% Fib suggests that the sellers are already losing some steam. Given all these factors, I decided to jump in and buy at market (0.7111).
I’m placing my targets at 0.7180 and at 0.7300. I’m also setting my stop at 0.7035 which is below the 61.8% Fib to give this trade enough breathing room.
Here’s what I did:
Bought NZDUSD at market price of 0.7111, tp1 at 0.7180, tp2 at 0.7300, stop at 0.7035.
By the way, have you guys seen the new “Double Down” sandwhich of KFC? Look at the calories on that sucker… but it just looks so scrumptious, I’m gonna grab one for myself later!
Thanks for reading my trade idea. To stay posted with my trade updates, follow me on MeetPips.com!