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Close Open Orders: 2008-06-12 10:24

The Greenback continued to push higher on a broad base through the Asian and European session with no retracement. This has taken USD/JPY far and away from our long orders at 105.80, so I have decided to close those orders and look for opportunities else where.

Close open orders. No trade.

Trade Idea: 2008-06-11 18:28

PoD Chart

Good evening! It’s time to meet up with an old friend, the “trend,” today as the Greenback continues to power higher on the US interest rate outlook.

With a quick glance at the chart, we can see the pair steadily rising over the past few weeks, and with Bernanke’s comments on the Fed’s stance on inflation, the Greenback took a boost higher in the past couple of trading days. Today, the pair took a hit as commodities pushed down equities and created a bit of risk aversion in the markets, but this may prove to be an opportunity to ride the trend higher at a better price.

I’ve drawn a Fibonacci retracement tool on the chart, and it appears that the 50% – 61% Fibonacci retracement level seems to line up with the 106.00 area. You know how I like to play round numbers, so I will short just below 106.00 with a stop at 105.30. My ultimate target is the previous high, around 107.70, but I may change to a trailing stop if momentum is strong to the upside.

Long USD/JPY at 105.80, stop at 105.30, pt1 at 106.30, pt2 at 107.70

Remember to never risk more than 1% of your account on any single trade. Adjust position sizes accordingly.

We do have US retail sales data tomorrow, which is expected to be better than last month’s numbers (probably due to inflation). If they come inline or better, that should do well for our trade, and any surprise of weakness in retail sales may send the pair lower and dampen hopes of a rate hike for the Dollar bulls. I may close any open orders or open positions just before that data is released at 1230 GMT tomorrow. Stay tuned, good luck and good trading!

On a side note…Don’t forget to check out Freshpips.com! Forex news picked by Forex traders! Let’s help each other out find what moves the markets…See ya there!

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