So much for getting bargains!
Just when we thought that USD/CAD‘s long-term rising channel was going to hold, a strong appetite for the Loonie suddenly spiked. Apparently, the bulls liked that China and the eurozone printed strong data and that Canada’s core CPI came in at 0.3% when many were only expecting 0.2%.
I didn’t even have the chance to adjust my trades! The pair triggered my order as soon as it was released and proceeded to my stop loss area on the next candle. Here’s a summary of my trade:
-30 pips, -0.5% of my account.
I guess I should’ve anticipated high volatility for Canada’s CPI as there weren’t many U.S. traders around last Friday. Or maybe I could’ve adjusted my stop losses and limited my exposure. But oh well, that’s another lesson I’ll no doubt be thankful for someday!
Trade Idea: 2012-11-22 5:55
Guess what? I’m planning to play USD/CAD’s long-term rising channel once again! It looks like the 4-hour chart is giving me a bunch of bullish signals for this pair as the bottom of the channel lines up with a support level and this week’s bottom WATR, not to mention that .9950 itself is a minor psychological support level.
As for fundamentals, I have a good feeling that the Canadian retail sales release during today’s U.S. session will disappoint as Canada’s manufacturing sales have been plummeting recently. Jobs growth has been weak in Canada last October, hinting at a potential downturn in consumer spending. If the actual figures fall short of the 0.5% consensus, I’ll be holding on to my long USD/CAD trade until it reaches the top of the channel.
I also noted that Canada will release its CPI at 2:30 pm GMT tomorrow so I’ll keep tabs on that to figure out if I should keep my trade open or exit early. After all, price action could get a little crazy over the next few days as most traders will be off enjoying their turkey on Thanksgiving. Do you think I’ll be able to add a winning USD/CAD trade to my long list of things to be thankful for?
Here are my trade details:
Long USD/CAD at .9950, stop loss at .9920, profit target at 1.0050. I’ll be aiming for the previous week high as my profit target and risking 0.5% of my account on this trade.
If you plan to tag along with me, don’t forget to check out our risk disclosure.
Happy Thanksgiving!
Have fun and good luck trading this week, friends!
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