Eeeeep!!! It looks like the markets aren’t willing to go back to fundamentals anytime soon! My order got triggered and stopped out on the same day! The upside surprise on China’s manufacturing PMI sure threw a mean curve ball on risk sentiment.
With that piece of news, mixed in with strong economic reports from the U.K., the U.S., and the euro zone, my trade had no chance! The sudden burst of risk appetite boosted EUR/USD to an intraday high of 1.3182, which was enough to hit my entry order and my stop loss. *sniff*
Ah well, it was all part of the risks I took with that trade anyway. As soon as I finish my second massage for the week, I’ll get back to those charts and move on to my next trade!
Trade Idea: 2010-12-1 1:19
I hope it’s not too late to short the EUR/USD! It has fallen quite a bit (yes, I know that’s an understatement) since I last tried to short the pair, but I think it could go lower… especially now that Spain’s and Italy’s debt problems are starting to hit the limelight.
If you don’t know what I’m talking about, then you clearly have not been reading Forex Gump’s posts on the latest forex news events! Personally, I think they’re pretty amazing, as it allows a noob like me to understand complicated macroeconomic concepts and apply them to my trading.
In any case, I do agree with Forex Gump’s view. I believe that the spotlight remains on the euro zone’s debt troubles, which means traders will try to find ways to short EUR/USD as much as possible.There is one particular news event that could really botch my trade though… Of course, I’m talking about the upcoming NFP report on Friday! If the actual figures come above forecast, then we may see traders set aside their euro zone debt concerns and trigger a wide-reaching case of risk appetite. And that, dear readers, is very bad for my trade idea!
Now, if you take a look at the 1-hour chart, you’ll see that price is slowly creeping up to the Fibonacci retracement levels.
I drew the swing high at yesterday’s high and the swing low at yesterday’s low. I’m thinking of catching a pullback right at the 50.0% Fibonacci retracement level since this seems like a reasonable destination. I believe there will be enough volatility from all the economic reports that will be released later for my trade to trigger.
As for my stop loss, I’m setting it right above yesterday’s high at 1.6165. Hmm… I’m eyeing 1.2980, the recent low, as my first profit target. And I’ll be taking the rest of my position off at 1.2900, which should help improve my risk-reward trade-off.
Short EUR/USD 1.3060, pt1 at 1.2980, pt2 at 1.2900, stop loss at 1.3165.
That’s all for now! Off I go to get a much-needed manicure!
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