Zzzzzzzzz…Yup, that’s about how exciting the EUR/CHF market has been for the past two days. To be fair to the pair, there has been little news to spark moves in the markets other than the Auto Bailout plan in the US. In Europe, we saw better than expected ZEW Economic sentiment data, but it still reads very negative.
We may see some life in the markets in the upcoming European trading session as the SNB announces their rate decision at 830 am GMT. Expectations are to take interest rates down by 50 basis points to 0.50%. This could be detrimental to my trade as we may see sentiment shift to more confidence and risk tolerance. EUR/CHF may rally further, so I have decided to close my trade early.
Closing trade at market (1.5600).
Total: -40 pips/ -0.40% loss
So, I took a very small hit, but it’s all about cutting losers quickly to stay alive in this game. Stay tuned as I may have a new trade idea before the end of the week.
Trade Idea: 2008-12-08 13:36
Greetings! EUR/CHF is giving me another potential trade opportunity on the daily chart as the pair hits the 61% Fibonacci retracement level once again. Are sellers ready to jump back in once again?
We also have bearish divergence forming as price action makes its way higher, while the stochastics fall a bit lower.So, while my trade is based on technicals today, we always gotta look at the fundies, right?
The Euro has risen as of late to risk tolerance rising across global markets. The US Dollar, Japanese Yen, and Swiss Franc have taken hits as traders get a bit braver as we see a positive talk from government officials and more and more money thrown at the financial crisis.
For me, I agree with US President-elect Obama who said, “it will get worse before it gets better.” Credit markets still haven’t unfrozen, housing markets are still taking a pounding, demand for raw materials is still down, and consumer confidence is totally wack as people lose jobs.
I think this recent rally is another short term selling opportunity and this is what I’m gonna do:
Short EUR/CHF at market (1.5560), stop at 1.5660, pt1 at 1.5460, pt2 at 1.5000
Remember to never risk more than 1% of a trading account on any single trade. Adjust position sizes accordingly.
Stay tuned my friends!
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