After an unexpected strong run in my favor, I decided on Friday to close my long NZD/CHF position to lock in a solid profit to avoid weekend risk. Here’s a quick review!
NZD/CHF Long Setup
After entering a half position to go long on NZD/CHF at 0.6000 (with additional orders to buy at 0.5930) after an upside triangle break, the pair didn’t take long to continue the rally higher thanks to the broad risk-on sentiment, fueled by expectations that economies are set to bounce back soon now that pandemic lockdowns around the world are ending (especially New Zealand who just went covid-free!).
With a solid move in my favor to trade above the 0.6100 handle, and strong momentum seemingly still in play, I decided last Tuesday to reduce my risk by rolling up my stop to just under my entry, and I increase my potential profit by rolling up my target from 0.6200 to 0.6300.
And just a few days after that, NZD/CHF shot up even faster, nearly retesting my new max profit target at 0.6300 before slowing down and pulling back. On Friday, I decided that I caught enough of the move and I wanted to avoid weekend risk, so I closed my position manually (0.6255) for a great return-on-risk taken.
Total: +255 pips avg. / +0.91% gain on 0.50% risk taken
Overall, this was a very good trade, riding the main “reopening theme” higher on a solid technical setup, but I definitely could have been bigger in the trade, especially since momentum remained strong during my adjustment last Tuesday. I probably should have added to the position then, but I was a little skeptical that this rally still has legs so I played it safe.
Well, 0.6300 still has yet to be tested, so I may prove to be correct with taking off the trade now, but if I am wrong and the pair does break above that level and holds, I will look into re-entering that position after a re-assessment of the markets.
Stay tuned for that update if it comes, and as always, remember to never risk more than 1% of a trading account on any single trade. Adjust position sizes accordingly. Create your own ideas and don’t simply follow what I do.
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