USD/CAD – Trade Closed

Trade Closed: 2008-10-09 11:00

My trade was triggered long yesterday at 1.1100 as the pair broke above upward resistance, and everything was looking great until this pesky little “coordinated global rate cut” happened. I was stopped out within an hour as this event whipsawed USD/CAD down 100 pips, close me out, and pushed the pair higher and higher to hit my profit targets…. grrrrr!!!!

Total: -100 pips/ -1.0%

So, I’m a bit bummed on the bad luck, but my money management plan kept my loss to a very small amount. The US Dollar continues to be the safe haven play in the current environment, and after the global rate cuts failed to spark confidence, I continue to look for long US Dollar opportunities until sentiment changes. Stay tuned!

Trade Idea: 2008-10-08 01:06

comdollsff

Greetings Friends! We see a nice chart pattern setup on USD/CAD as the pair consolidates after a nice trend higher. Are we about to see a breakout higher or is the rally out of steam?

So, we have a basic chart play as the pair consolidates as it finds resistance around 1.1080 and support at the rising trendline drawn on the chart. Without knowing where the pair will go next, I’d like to setup a straddle play on the idea that the current consolidation behavior may lead to a break out. I look to:

Long USD/CAD at 1.1100, stop at 1.1000, pt1 at 1.1200, pt2 at 1.1300

or

Short USD/CAD at 1.1000, stopat at 1.1100, pt1 at 1.0900, pt2 at 1.0800

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

If one order does get triggered, I will cancel the opposite long/short order.

We do have event risk with housing data from both the US and Canada at 830 am EST, so please be very cautious in the morning US session. Stay tuned!

  • barrooo

    Looks like an interesting trade, but just a quick question about trade entry points. In this case would you look to go long/short as soon as price action reaches any of the trigger points, or would you look for a break and close above resistance or below support, before entering?

  • barrooo

    Looks like an interesting trade, but just a quick question about trade entry points. In this case would you look to go long/short as soon as price action reaches any of the trigger points, or would you look for a break and close above resistance or below support, before entering?