With no new setups jumping at me at the moment, here are updates and adjustment to my current open ideas on USD/JPY, EUR/NZD, and AUD/USD!
Trade Closed: USD/JPY Downtrend Momentum
Decided to close down my USD/JPY short today as the strong downward momentum we saw at the beginning of the year has clearly faded away.
Global sentiment flipped to positive in the beginning of January as U.S.-China trade tensions have eased, looking closer to getting a deal done rather than an all out trade war…at the moment. Avoiding a trade war is obviously great for the U.S. and the global economy, so USD/JPY has been on the upswing as traders sell Japanese yen again to fund riskier bets. I can also argue that sentiment has been positive on the idea that major central banks like the Federal Reserve look to pause on quantitative tightening as economic data has weakened recently.
With price action invalidating the original sell pattern on fundamental support, I closed my USD/JPY short position manually (109.41) for a very small loss:
Total: -71 pips; -0.24% loss on 0.50% risk
Trade tensions are starting to rise again, but I’ll wait for another downside confirmation of a few red daily bars before betting again on risk-off sentiment and on the Japanese yen.
Trade Update: Fib Short on EUR/NZD
With the market so close to my stop at 1.6950, the odds are pretty high this will close at that level, and the upcoming New Zealand CPI q/q data may take it up there.
If the data actually comes out better-than-expected, there’s a possibility this pair could see some selling pressure and back on the downtrend lower. If that’s the case, I’ll look to add once again, but lets see what the data comes out as and how the markets react to it first.
Trade Update: AUD/USD Long-Term Downtrend?
The silver lining among my open trades is my short position in AUD/USD. My short orders at 0.7200 were triggered and the market has since fallen lower, lately on news that China’s economic growth grew at the slowest pace in 28 years.
This of course is not good for Aussie bulls being how big of a trading partner China is to Australia, and this could be the catalyst that finally pulls in sellers to take this pair lower.
If economic data continues to get worse around the globe, especially China, I’ll look to add to this position, so stay tuned for that and as always, good luck and good trading!