Trade Closed: 2009-02-24 11:11
It looks like Eurozone weakness was not able to overcome Japanese economy weakness and the previous resistance failed to hold. I took a hit as EUR/JPY rose to my stop out level at 122.50.
Total: -250 pips/ -1.00% loss
In retrospect, I think my mistake on this trade was under estimating the sentiment on the Japanese Yen and how it was losing value as a save haven currency. My focus was on the issues with Eurozone banks and the potential damage they would do to the euro. It was a good technical trade with high probability, but this was an example of why we need risk management plans for those times when we’re proven wrong. I took a small hit to my account and so I live to trade another day…and that’s what counts.
Thanks for checking out my blog and stay tuned for new ideas!
Trade Update: 2009-02-23 14:21
Good afternoon! Just a quick update on my trade as I am now short EUR/JPY. My trade was triggered and after a scary run to just about 122.00, the pair has found sellers to push it back down.
I am still short bias on the Euro. Eurozone bank stability is still in question, and until we see a change in that situation, the Euro maybe prone to more selling on the rallies. There’s a bit of economic data this week, most notably the German Ifo Business Climate release. Further weakness may steer the Euro down lower.
I will continue to hold my position for now, but stay tuned for adjustments. Thanks!
Trade Idea: 2009-02-19 10:16
Good Morning! I thought I’d throw up a quick trade idea on EUR/JPY, as the pair hits major resistance and a psychologically significant level.
I have the EUR/JPY on the four hour chart, and it looks like today’s price action has brought the pair back up to the 120.00 area. The pair has recently met significant resistance and reverse, so the question is, “will resistance hold again?” Stochastics are indicating the pair is overbought in the short term and I like the probability of another reversal at these levels. Here’s what I’m going to do:
Short EUR/JPY at 120.00, stop at 122.50, pt1 at 117.50, pt2 at 112.50
Remember to never risk more than 1% of a trading account on any single trade. Adjust position sizes accordingly.
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