More Upside Breakouts for AUD/USD? – Trade Closed

Trade Closed: 2012-01-31 02:18
Aww geez, this isn’t exactly how I wanted my first trade of the year to turn out. After a bunch of tries, AUD/USD just couldn’t quite make it to my first profit target near 1.0700. As you can see from the chart below, it even came a few pips close at 1.0689!

AUD/USD Trade Update

I probably should’ve exited this trade early when I had the chance and locked in the few profits that I had back then. It looked like the pair was having a hard time continuing its rally towards the end of the week, but I was crossing my fingers that the U.S. GDP would give it another boost. Sadly, the GDP figure failed to meet expectations and AUD/USD was forced to retreat.

Also, I should’ve closed my trade before the end of the week as I promised in my trading resolutions for the year. Oh, stubborn me! The thing is, as I mentioned in my earlier trade update, the technicals were still signaling an Aussie rally as shown by the bullish divergence at the 38.2% Fib level.

Do you think it’s the end of AUD/USD’s rally? Should I switch sides and join the bear camp now? I’d love to hear your thoughts to help me bounce back this week. Looking forward to your tips!

Trade Update: 2012-01-27: 1:24

Okay, maybe I shouldn’t have counted my eggs before they hatched. Unfortunately for my trade, AUD/USD hasn’t quite broken its highs near my first profit target. In fact, it has even went down by a few pips below my entry level!

Good thing I spotted a bullish divergence on the 1-hour chart, which is supported by an overbought Stochastic signal. The Fib levels are still within my original stop loss area, so I’m keeping my positions open for now.

AUD/USD Trade Update

I’ll watch out for the big U.S. GDP report coming up in a few hours though. Word from my forex friends is that it’s expected to come in a bit weaker than many are expecting, so I’ll probably close my position if it takes its toll on risk sentiment later. However, if the report turns out stronger than estimates, then I will keep my position open and consider locking in a few pips before the week ends.

So, what do you think of my plan? Do you think it’s okay to wait for the reports later, or should I just close all my positions now?

Trade Update: 2012-01-26 08:58
A few hours ago I entered a long AUD/USD trade at market on the belief that the pair will continue to shoot up during the London session.

The trade idea worked pretty well for a couple of hours, but now the pair is stalling and even forming a rectangle near the 1.0670 area, about 30 pips away from my first profit target at 1.0700. The question is, are we seeing a reversal, or just a pause before another rally?

AUD/USD Trade Update

My forex friends told me that investors are currently focusing on the good news and shrugging off the bad news. Heck, the weak initial jobless claims report isn’t standing a chance against the strong durable goods data!

Should I hold on to my trade, or take profits early? This is my first actual trade for the year, so I’m really crossing my fingers for a win! Any advice would be much appreciated!

Trade Idea: 2012-01-26 02:25
After my AUD/USD and NZD/USD trade setups didn’t get triggered, I’ve decided to be more aggressive this time as I already pulled the trigger on my long AUD/USD trade. Check out this breakout setup that I spotted!

AUD/USD Breakout Setup

AUD/USD staged a strong rally yesterday when the Greenback sold off after the FOMC statement. It turns out that the Fed plans to keep rates on hold until late 2014, and this announcement caused traders to lose their appeal for the U.S. dollar. Aside from that, Big Ben and his men expressed openness for more QE down the line as they highlighted the dim economic prospects in the U.S.

Although recent economic data from the Land Down Under hasn’t exactly been on the up and up, I think the Aussie could continue to benefit from the surge in risk-taking. To top it off, gold prices jumped above the crucial $1700/ounce hurdle, which means more positive vibes for the Australian dollar!

For now, it’s tough to tell how long this risk rally would last, but I’m setting my sights on the 1.0750 mark for this pair. However, I plan to lock in some profits and move my stop to entry once price makes a ¼ ATR move from my entry. Here are my trade details:

Long AUD/USD at market (1.0635), stop loss at 1.0575, pt1 at 1.0700, pt2 at 1.0750.

Do you think my first trade of the year will turn out to be a win? Let me know what you think by dropping a comment or two below or hitting me up through any of these pages:

@Happy_pip Twitter
Playing with Comdolls Facebook page
Happy Pip Comdoll Corners
MeetPips.com

Happy Australia Day, by the way!

Happy time

Other Popular Articles:

Comdoll Trading Kit (Jan 30-Feb3) AUD/USD trade 2012 Gold and Oil Predictions What is STA strategy?

  • Srakso Snimial

    The GDP came in weaker than expected, one thing I don’t really understand why AUD fell against the USD. Can someone explain that please ? 

    • happypip

      I think it’s because of risk aversion. Weaker growth figures from the US discouraged traders from buying up higher-yielding and riskier currencies and forced them to flock to the safe-haven U.S. dollar instead. 

  • Jj_likes_4ndz

    Hey Girl I have also closed my order after following a long trend I made 241 pips I am convinced that the resistance at 1.0700 will hold.Thanks for saving my valuable pips.

    • happypip

      Good call in locking in your profits just before 1.0700. As for me, I missed my PT right there by a few pips. Too bad. 

  • HarryPilgrim

    Since you ask, I would suggest that while the uptrend on the day chart remains intact, long continues to be the correct direction. With bad data appearing on all sides, we should perhaps await decision time at the lower trend line.

  • Foricks

    Next Trade, Dol…
    Have you seen the bullish divergence on the USDCAD 4 hour?  Looks like a rally up to ~1.02 or at least the 200MA may be in the mix.  Stop @ just below .9950 is a 2:3 risk:reward.
    Comments?

  • SwordOFManagement

     If placing a trade were a sure thing then you wouldn’t need a stop loss ;)

     Here is a 10 x 2 (10 pips to cont. 20 to reverse) P&F chart with a basic BO:

     link to i44.tinypic.com….

     Remember Dol, trading is about making the best decisions that you know how; do that and everything else is just a stepping stone.

    • happypip

      Yipes! I think I still need to put stops in order to limit my risk. Thanks for the feedback though!

  • Foricks

    Hey, Dol,
    I’ve been in this trade since November…Love the carry trade. and have my first TP just short of 1.1000 and the second at 1.1400.  Gold is rocking as investors digest Bernanke’s drivel of “dual mandate” “headwinds” “for an extended period”…blah, blah,blah.  I’m in for the long haul (and 0.1 pip per day on the carry)
    Cheers,
    Foricks

    • happypip

      Wow, nice swing trade you got there! That gold rally these past couple of days has been pretty crazy, too. Congrats!

  • Sunil

    I am expecting bull for usd , i do trad according to cftc and moving averg , as of may study dollar is getting stronger .

  • fedegmail

    Good idea, well done! See you at your next post :) Bye bye and good luck!