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Trade Canceled: 2011-08-09 3:14

Boo hoo! So much for trying to play the comdoll crosses. My trade idea was quickly invalidated as AUD/JPY failed to reach the top of the channel I drew. Instead, it just dropped like a rock and I didn’t even get a chance to jump in.

Blame it on the strong risk aversion vibes we got last week. The Australian dollar couldn’t put up a fight since it was bogged down by dovish RBA rhetoric and weak data from the Land Down Under. All that made AUD/JPY go down under!

AUD/JPY Descending Channel...not

I probably should’ve just jumped in when I saw the 85.00 handle hold as resistance before the pair plummeted. Or I could’ve entered when it broke below the channel. Too bad it’s right below 80.00 now, and I could’ve made at least 500 pips on a short AUD/JPY trade.

But hey, that ain’t so bad for giving crosses a shot! I did get the overall direction right, didn’t I?

Don’t worry, I’ve got a brand-spankin’ new comdoll trade idea for this week! I’ll keep y’all posted!

Happy time

Trade Idea: 2011-08-04 8:06

Good morning, friends!

As I hinted in my Playing with Comdolls Facebook page earlier this week, I wanna try my hand in playing the commodity crosses this time. You see, I haven’t had much luck trading the usual AUD/USD, USD/CAD, and NZD/USD pairs lately so I tried to look for setups in other comdoll pairs.

Since the dollar’s price action had been pretty crazy lately, I decided to take a look at some of my favorite comdoll crosses this week.

Fundamentally I’m still bearish on the Aussie for the next couple of days. And why not? Aside from risk aversion plaguing the markets, Australia had also been popping out worse-than-expected building permits, retail sales, and trade balance figures over the last few days. Heck, even the RBA was dovish in its last interest rate statement!

As for the yen, I believe that it will go back to rising against almost all of its counterparts as soon as the BOJ intervention begins losing steam. After all, nothing much has changed fundamentally for many economies. Unless the NFP report this Friday surprises to the upside, that is.

Because of my fundamental bias, I decided to look for a trade on AUD/JPY. Et voila! On AUD/JPY’s 4-hour chart I spotted a descending channel which held up nicely in time for the BOJ‘s currency intervention a few hours ago. I decided to place a short order at the 87.00 level because I figured that’s a pretty good resistance level for the pair.

AUD/JPY Descending Channel

I’ll be flexible on my entry level though. Hey, I’m still stretching my muscles on trading comdoll crosses! If stochastic on the 4-hour chart reaches the overbought region, I’m willing to move my entry to 86.00 and place a 100-pip stop on it. In addition, I’ll be placing my first profit target at the 84.00 support while I determine my next profit target. If price goes my way and reaches 84.00, I’ll close half my position and try to ride the downtrend.

So what do you think of my trade idea? Is trading crosses really a better idea at this time, or should I stick to the Greenback? Should I move my entry or stop?

Tips, words of caution, and pieces of advice are always welcome, of course! Just leave a message on the boxes below. If you want you can also contact me through my Twitter account or even on one of my Comdoll Corners.

Looking forward to hearing your thoughts!

Happy time

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