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Trade Closed: 2009-06-10 10:17

And yet another cruel day in the Forex markets…haha! Since I posted my trade idea, USDJPY did fall enough to trigger my long trade at 97.75. Unfortunately, today the pair went down further, just enough to touch my stop, take me out and rise back above 98.00…doh!

Stopped out at 97.10

Total: -65 pips/ -1.0% loss

I am a bit peeved at myself as I should have drawn the Fibonacci from 95.50 instead of around 96.50. Then I would have seen that my stop was the 50% retracement of that swing, but situations are always much clearer in retrospect, right?

So, another loss and that makes that two in a row….grrrr! Hopefully, the majors will give me another opportunity to make it back before the end of the week. Stay tuned!

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Trade Idea: 2009-06-09 00:47

PoD Chart

Good evening! I thought I’d tackle USDJPY once again as a nice technical setup is forming on the one hour chart. Let’s take a look!

As we can see on the chart, the pair has been on a short term uptrend in the one hour timeframe. Stochastics are in oversold territory, and the pair is about to hit the rising trendline. I also used the Fibonacci tool to find other potential support levels, and we can see that the 50% Fibonacci retracement area lines up around the rising trendline.

A quick look at fundamentals, and the US Dollar has been given extra support after the recent surprise in the US jobs data on Friday. The media seemed to have focused only on the headline number of jobs lost, so there was speculation that we are near the end of the recession sparked new speculation and that the Fed may raising rates to combat the potential inflation. Will the affect of jobs data and interest rate change speculation hold for long? I don’t know, but for now the “trend is our friend” and the higher probability direction to trade with. Makes sense to go with it right? So, I will go with the trend for a short-term day trade, but wait for a better price. Here’s what I am going to do:

Long USDJPY at 97.75, stop at 97.10, pt1 at 98.40, pt2 at 99.05

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

No major data for the US until Thursday with Initial Claims and Retail Sales, and nothing for Japan until Wednesday with GDP. I expect technicals to play out until then. Let’s see what happens and stay tuned!

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