USD/CAD – Trade Closed

Trade Closed: 2008-08-19 10:37

USD/CAD ranged throughout the Asia and European trading session, and the volatility was just enough to reach my breakeven stop at 1.0665.

My remaining position was closed at breakeven.

1st Half: +60 pips
2nd Half: +00 pips
Total: +0.33% gain

Trade Update: 2008-08-18 21:04

USD/CAD did move lower at the end of the week, making its way to a low around 1.0550 early during Monday’s European trading session. Apparently, that level brought in a good amount of buyers as the pair rallied higher, taking USD/CAD back above 1.06, and near my entry point.

It looks like the rally has run out of steam once again as the stochastics on the hourly are back over a reading of 80 as price action consolidates. We may possibly see a swing back lower, so I plan to hold onto my trade for now and see where tomorrow’s US and Canadian data will take us then. I expect the US Housing data and PPI data to cause little impact, as much of the bad news is priced into the Greenback, unless we see a large deviation from expectations. Stay tune and good luck in your own trading!

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Trade Update: 2008-08-14 09:06

Good morning! My short trade in USD/CAD was triggered and after a brief attempt to hit 1.07, the pair dropped lower during the morning US session to hit my first profit target. Time for some adjustments.

First profit target hit and portion of trade closed out at 1.06. Adjust stop on remaining position to breakeven to create a risk free trade.

I’m going to hold this into the weekend for hopefully catch an extended move lower. Good luck and have a great weekend!

Trade Idea: 2008-08-13 20:58

comdollsff

Hello! After almost a fourteen day rally and a 6% move higher, it looks like USD/CAD is finally taking a breather. This move seems a bit overdone, which may be a great opportunity for a short term swing trade.

I have a one hour chart, showing the pair in a range bound behavior. I am looking for a short term swing lower as the pair looks oversold on the daily time frame, and consolidation may be an indication that the bulls have run out of steam and that sellers are ready to take over.

Also, oil has rallied for the past couple of days as inventories rise and refiners reduced capacity. A further rise in oil may hurt the Greenback, especially against the Loonie as a large part of Canada’s exports consist of the “black crack.”
One of the fundamental risks that still may hurt the Loonie is the slowdown in global growth will finally catch up to the US, forcing other central banks, including the BOC, to lower interest rates. I think this has been largely priced into the pair for now, and may not factor into trading in the short term.

So, I am going to short USD/CAD for a short term trade (a few days), but wait for a better price. Hopefully, volatility will take us back above 1.0650. I am going to:

Short USD/CAD at 1.0665, stop at 1.0755, pt1 at 1.0600, pt2 at 1.0450

Remember to never risk more than 1% of a trading account on any single trade. Always adjust position sizes accordingly.

Stay tuned and good luck!

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  • camelman

    Hi ComDolls, I am wondering why wouldn’t you go long at 1.06/1.0620 and take it to 1.070 based on the chart you have and also since the USD can do no wrong these days and much stronger tahn the CAD? Thanks

  • camelman

    Hi ComDolls, I am wondering why wouldn’t you go long at 1.06/1.0620 and take it to 1.070 based on the chart you have and also since the USD can do no wrong these days and much stronger tahn the CAD? Thanks

  • happypip

    Hey camelman….it’s all in the analysis, but basically I feel that after a 14 day rally, there may not be enough buyers to push the pair higher in the short term…it’s a contrarian/counter trend type play on extreme movement (one way moves in this short of a time span is very rare)… I hope this helps!

  • happypip

    Hey camelman….it’s all in the analysis, but basically I feel that after a 14 day rally, there may not be enough buyers to push the pair higher in the short term…it’s a contrarian/counter trend type play on extreme movement (one way moves in this short of a time span is very rare)… I hope this helps!