Trade Closed: 2012-06-19 10:05
I know, I know. I should’ve let y’all know that I got stopped out at breakeven on this long trade nearly a week ago, but I was still wallowing deep in regret back then.
You see, I adjusted my stop to my entry price around .7720 for a risk-free trade but price merely dipped exactly to that level before gapping up over the weekend and making that 200-pip rally we witnessed last week. Drats!
This feels a lot like that time I bought a pair of black designer pumps only to find that it was put on a 50% off end-of-season sale the following week. Oh, the regret. It burns!
I did think about reentering at some point but I already opened my long AUD/USD trade towards the middle of the week and I didn’t want to double my risk back then.
I could think of a bajillion ways on how I could’ve played this setup better and I’m sure you have some ideas, too. But what I’m more interested to know is this:
Did you ever go through something like this yourself? Don’t be shy to share your stories with me because I sure could use some comforting words right about now.
Trade Adjustments: 2012-06-13 7:28
Thanks to profit-taking ahead of the Greek elections and a bit of risk appetite, comdolls like the Kiwi have been gaining ground against the Greenback. Unfortunately, it looks like the .7800 handle is holding like a boss for NZD/USD. So despite the new highs that I’m seeing today, I’ve decided to move my stop loss to break even.
I’m not sure if this is the right way to go though. After all, forecasts say that the RBNZ will most likely hold its rates at 2.50%, which could prove positive for the Kiwi. Not only that, but rumors of QE3 from the Fed could escalate and boost high-yielding currencies like the comdolls.
On the other hand, the Greek elections is just around the corner and there’s still a lot of uncertainty over the Spanish bond yields. Oh and need I mention the resistance at .7800?
For now I’ll move my stop loss to a bit above break-even for a no-risk trade. Hopefully the Kiwi-bullish prospects that I mentioned above will outweigh the comdoll bearish ones.
What do you think of my plan? As always, your feedback is more than welcome!
Trade Update: 2012-06-08 6:51
Oops, it seems that NZD/USD didn’t bounce as strong as I predicted it would and it appears to be pulling back to the neckline of the double bottom formation that I pointed out. The question is: Should I hold on to this trade or not?
The 4-hour time frame is showing that the pair is finding support at a former resistance area, which is right in line with the 38.2% Fibonacci retracement level. I’m crossing my fingers that this level would hold until next week’s open because I’m planning to keep my trade open much longer.
Yep, that’s right, I’ll be holding on to this trade over the weekend! Now some of you might remind me of my trading resolution of not exposing my trades to weekend risk, but hear me out. You see, I based this trade on the daily time frame and I’m looking to hold on to it for the long-term so it makes sense for me to keep it open at least until next week, right?
I do hope that I won’t regret this decision later on, but I’ll also be keeping my wide stop of 200 pips just in case the pair makes a sudden gap downwards on Monday’s open. After all, my stop is reasonably placed just below the farthest Fib level, which would give this setup enough breathing room. I’ll make my adjustments at the start of the next week depending on how price action and risk sentiment play out.
Do you think I’m making the right decision? Remember, I take your advice seriously and it’s never too late to warn me to jump out of this one if I should!
Trade Idea: 2012-06-07 4:51
After shorting the comdolls last month, I’m starting this month with a long Kiwi trade! Unlike my previous trades though, I’ll probably hold on to this trade a bit longer. That’s right, I’m looking at the daily chart this time!
NZD/USD just bounced from the rising trend line that has been holding since August 2010. Also, if we zoom in on the chart, we’ll also see that the pair had just broken a double bottom neckline. According to the School of Pipsology, that’s good for at least the height of the double bottom formation. We’re talking 200 pips in our case!
Since no economic data will be released in New Zealand for the rest of the week, I’m relying on risk appetite to sustain the Kiwi’s gains. For one thing, the delay in the implementation of China’s new bank capital rules is helping export-related economies since it signals more loans (and more business) from China.
Of course, we can’t forget that the Kiwi is riding on Aussie strength! New Zealand’s major trading partner printed a surprisingly strong GDP report yesterday, which was followed by stronger-than-expected employment numbers a couple of hours ago.
In the euro zone, markets are optimistic that the European officials will act to protect the region from debt contagion. Lastly, the comdolls, commodities, and other high-yielding currencies are getting a boost from QE3 speculations in the U.S.
With those bullish notes in mind, I decided to join the comdoll bull camp. Here’s my plan.
Risking 0.50% of my account, I bought NZD/USD at market (.7719) and placed a 200-pip stop loss below the trend line (.7520). Profit target is yet to be determined.
I know that a 200-pip stop loss might seem big, but I’m planning on moving my stop to break even as soon as my trade goes up by 100 pips. I figured the trend line bounce would’ve been clear by then. If you’re in this trade with me, make sure you read our risk disclosure!
What do you think of my trade? Am I trading in the right direction or am I missing a few factors? As always, your opinions are most welcome!
Hope your trades are all doing well!
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