Boo hoo, I can’t believe I missed my entry by three measly pips! The disappointing NFP report did bring the Greenback down, but not low enough to trigger my entry order at 1.0000.
The pair already bounced from that area, which means that I already missed the boat and that it’s time for me to cancel my open orders. Better luck next time, I guess.
Trade Idea: 2010-11-25 03:28
It’s that time of the year again when we gather around the table and remember the things that we are thankful for. I just hope this trade is one of them!
The Greenback took a backseat against the Loonie yesterday, but I’m sure as the rosemary turkey in my oven is juicy that things will turn around for the pair. For one, the unemployment claims in the U.S. dropped to 407,000 last week, and consumer confidence recently reached a 5-month high.Meanwhile, over in the land of warm maple syrup, core retail sales have weakened to 0.4% in September while house prices have also gone down. Of course, there’s also the risk aversion factor in the euro and Korean regions that could spoil the currency bulls’ appetite for the Loonie like sweet butternut squash lasagna that’s been in the fridge too long. This could entice the bulls to push the dollar, a safe-haven currency, up the charts.
I checked out the 4-hour chart and noticed that the pair seems to be aiming for parity again. Judging from the number of times USD/CAD bounced from the 1.0000 handles, I’m pretty sure that’s a solid support level. That’s why I plan to go long there!
If that level breaks, well, I’m out of here! I’m out of the trade, I mean. Of course, I took the fact that volatility usually spikes during and after Thanksgiving, so I set my stop a hundred pips away from my entry.
I’ll be aiming for the 1.0250 level for my first profit target since there seems to be an area of interest there. If the pair surges past that level, I’m gonna go for the gold and aim for the top of the range at 1.0350. But once my first PT gets hit, I’m gonna move my stop to breakeven to protect my profits.
Here’s my Thanksgiving trade recipe:
Long USD/CAD at 1.0000, stop loss at 0.9900, pt1 at 1.0250, pt2 at 1.0350. I’ll risk 1% of my account on this trade.
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