9/9/2011 Short GBPUSD & Short EURCAD

After my summer break I’m starting to ease myself back into the world of FX Trading.  It’s been a volatile 5-6 weeks which shows no sign of abating. Are we in for a re-run of September / October 2008?  Who knows. (But I wouldn’t bet against it!)

So on my growth account I’ve had these two trades trigger over the last 2 days. They’re still live so I thought I’d give you a heads-up to be able to watch them with me.

First up the Euro vs Canadian Dollar

There really is no respite for the Euro these days and there have been some great set-up over the last 2-3 weeks to get short the Euro.  This was my play on the EURCAD.

After a steep down ward move price goes sideways before Tuesday’s manic action which ended up being a huge engulfing hi-test reversal bar.  In an ideal world I love to trade such signals alas the price action was just a bit to big for my liking so I decided to wait and see what happened.  The following day (Weds 7/9/2011) the daily chart produced a nice inside pin-bar.  This was enough of a signal for myself and I decided to short below recent support at 1.38320. I didn’t have to wait long as the very next day price triggered and moved down strongly. And has kept going south ever since!

I’m trailing my stop on a daily chart and so far my stop is now at 1.3769 so I’m in a free trade with a few pips in the bag.  There is some congestion around the 1.3600 area and my charts are showing the next level of support at about the 1.3400 area.  Personally I’m expecting a hard snap-back to the 1.3800 area of the 200 EMA but as always we just trade our plan and wait and see what happens.

Next trade the GBPUSD.

This is not to dissimilar story to the EURCAD trade in that price has been in a strong down trend, there was an engulfing bar followed by an inside bar on the Daily chart.

The 4 hour chart showed a nice area of support and I placed an order to sell a break of that support at 1.5908.  Yesterday I was thinking that we may see a false breakout and whilst Cable did move north eventually yesterday it did so without hitting my entry order.

Earlier today my order was triggered and then completed a low test pin bar (check the 4 hour chart). I did once agin consider the possibility of a false breakout but this afternoon price has continued down. As per the EURCAD trade I am trailing my stop and looking down for support at 1.5780 followed by 1.5350.

Two very simple trades taken off the daily chart. Not much time and effort required to set and manage.  Lets see what happens with them.

With rumours of a Greek Default this weekend and the 10 year anniversary of 9/11 it could make for an interesting market opening on Sunday / Monday. As always we just wait and see what the market wants to do.

Enjoy your weekend and until next time, trade well.

FXTrader Paul