Breakeven Week 25

I'm ending the week at almost breakeven, gaining only +14 pips. Tough week characterized by the dollar being alternated to bull and bear. And it takes a lot to catch both. Think about catching a 2-trillion-dollar bull or a 2-trillion-dollar bear!

The breakout on the EUR/USD I wrote previously did not materialize despite the German PPI printing better than expected. I am watching out for this breakout next week.

Hopefully, next week (Week 26) will be more profitable. I am now on three consecutive weeks in positive territory. Yahoo!!!

I will also up the ante on my trades. Starting next week, I will be trading 6 lots at a time. I'm still contemplating on dividing my trades into halves of thirds. Let's see monday.

Greater profit opportunities but riskier.

Game Plan for June 19

Trading on the dollar pairs has been dancing along narrow ranges all morning. Last night, when positive data from US Unemplyment and the Philadelphia Manufacturing Index came out, the dollar sold off on sentiment that the US recession is nearing its end. However, at around 1:30am today, investors and traders ran towards the dollar as news about some Italian banks under review and possible downgrade by Moody's.

The EUR/USD also hit a wall on 1.40 which seems to be a very strong resistance.

EUR/USD

On the daily chart, this pair looks like a tiny dodgie primed for a breakout. Question is, which way?

So, for today, I will be placing a couple of 'ambush' entry order positions at 1.3930 (for a LONG position) and 1.3871 (for a SHORT position).

The only fundamental event for today is the German PPI due this afternoon which is expected to be bullish for the EURO. This could be the catalyst that will give this pair an upward kick.

However, prevailing problems on the European banking sector still casts a shadow over the Eurozone. Any further negative news concerning this will definitely cause a flight to the safety of the dollar.

June Trade # 26 - BUY NZD/USD

Limit is hit at +30 pips/lot for a total of +120 pips.


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June 18, 2009 2:08 pm (Manila)

BUY NZD/USD @ 0.6331
Stop - 0.6280
Limit - 0.6361

At about 10:00 pm tonight (Manila), US Unemployment Claims data is expected to come out and cause a sell-off in the dollar.

June Trade # 25 - BUY AUD/USD

June 18, 2009 3:04 pm (Manila)

Limit was just hit at +30 pips/lot for a total of +120 pips.

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June 18, 2009 2:07 pm (Manila)

BUY AUD/USD @ 0.7949
Stop - 0.7900
Limit - 0.7979

At about 10:00 pm tonight (Manila), US Unemployment Claims data is expected to come out with better numbers than previous. This may cause a sell-off in the dollar.

June Trade # 24 - BUY GBP/USD

June 18, 2009 2:49 pm (Manila)

Second half is out at +49 pips/lot for a total +98 pips.

Summary:

1st half: +60 pips
2nd half: +98 pips

Total: +158 pips

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June 18, 2009 2:49 pm (Manila)

First half is out at +30 pips/lot for a total +60 pips. Moving stops of second half to breakeven to make this trade risk-free.

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June 18, 2009 2:05 pm (Manila)

BUY GBP/USD @ 1.6385
Stop - 1.6333
Limit 1 - 1.6415
Limit 2 - 1.6436

At about 10:00 pm tonight (Manila), US Unemployment Claims data is expected to come out and cause a sell-off in the dollar.

June Trade # 23 - BUY GBP/USD

June 17, 2009 3:40 pm (Manila)

Second half of the trade got stopped-out at breakeven.

Summary:

1st half: +60 pips
2nd half: 0 pips
Total: +60 pips

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June 17, 2009 1:35 pm (Manila)

First half is out at +30 pips/lot for a total of +60 pips.

Trade is now risk-free as second half stops are moved to breakeven.

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June 17, 2009 1:10 pm (Manila)

BUY GBP/USD @ 1.6412
Stop - 1.6341
Limit 1 - 1.6442
Limit 2 - 1.6495

AT 4:30 pm today, the latest Bank of England Meeting Minutes will come out. It is expected to be bullish for the Pound as it may warn of inflation rising in the British Isles.

June Trade # 22 - BUY USD/CAD

June 16, 2009 9:58 (Manila)

2nd half is out at breakeven. Too bad. I will look to re-enter when a new opportunity presents itself.

Summary for this trade:

1st Half: +60 pips
2nd Half: 0 pips

Total: +60 pips

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June 16, 2009 9:37 am (Manila)

1st half is out at +30 pips/lot for a total of +60 pips. Moved stops of second half to breakeven. Trade is now risk-free.

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June 16, 2009 7:45 am (Manila)

BUY USD/CAD @ 1.1338
Stop - 1.1256
Limit 1 - 1.1368
Limit 2 - 1.1471

I believe that risk aversion sentiment in favor of the dollar is still strong. Oil has met strong resistance at $72/barrel and is barely holding on to $70. As bad news (Empire State Mfg and TIC Long-Term Purchases) struck last night, investors now question whether the current price can be sustained in the present environment --- the IMF and G8 Financial Ministers said that recovery is still not here and the situation remains volatile.

June Trade # 21 - SELL GBP/USD

June 16, 2009 8:30 am (Manila)

Both halves are out on strong dollar rally.

Summary for this trade:

1st half: +60 pips
2nd half: +132 pips

Total: +192 pips

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June 16, 2009 7:05 am (Manila)

SELL GBP/USD @ 1.6292
Stop - 1.6353
Limit 1 - 1.6262
Limit 2 - 1.6226

This afternoon, 4:30 pm, UK CPI data comes out which is expected to print out bearish for the Pound. Plus, the weekends comments by the CIB and the G8 Meeting will continue to reverberate and batter this pair down.

June Trade # 20 - BUY USD/CHF

June 17, 2009 1:35 pm (Manila)

Unfortunately, trade got stopped out at -68 pips/lot for a total of -272 pips.

Sometime noon yesterday, news came out about Russian President Mevedev's comments about the need for more reserve currencies outside the USD. This brought volatility into the market and made investors dump dollars as this is perceived as a threat to the greenback's uncontested reserve currency status.

As the BRIC (Brazil, Russia, India and China) nations hold their summit, currency traders will hold their breath and opt to steer clear of anything that has USD sign in it and make it weaker against the major currencies.

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June 16,2009 7:00am (Manila)

BUY USD/CHF @ 1.0928
STOP - 1.0860
Limit 1 - 1.0958
Limit 2 - 1.1046

At 3:15 pm today (Manila), Swiss Industrial Production data comes out which is expected to be significantly down from previous quarter. This should be bearish for the Franc.

June Trade # 19 - BUY NZD/USD

June 15, 2009 5:23 pm (Manila)

Unfortunately, trade did not go according to plan and was stopped-out at -38 pips/lot for a total of -152 pips.

A 'pump-fake' on that hammer.

This day's lessons:

- Befriend the trend.
- Take note of the pair's position on the bollinger bands.

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June 15, 2009 3:10 pm (Manila)

BUY NZD/USD @ 0.6363
STOP - 0.6325
Limit 1 - 0.6393
Limit 2 - 0.6433

Trading on pure technicals. The pair has been trending down for the better part of the day. A hammer formed on the hourly chart, conciding with the lower bollinger band and a 50% fibonacci retracement level. Time for the NZD to fight back!

Let's see how this turns out.

June Trade # 18 - BUY AUD/USD

June 15, 2009 5:24 pm (Manila)

Unfortunately trade got stopped-out at -40 pips/lot for a total of -160 pips.

That hammer 'pump-fake' got me.


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June 15, 2009 3:10 pm (Manila)

BUY AUD/USD @ 1.8042
STOP - 0.8002
Limit 1 - 0.8072
Limit 2 - 0.8120

Trading on pure technicals. The pair has been trending down the better part of the day. A hammer formed on the hourly chart, coinciding with the lower bollinger band.

Let's see how this develops.

Swiss Franc looks interesting this week

The dollar, as I write this, I strengthening against a basket of currencies, including the Euro, Pound, Yen, CAD, AUD, NZD and CHF. Oopss, that's against everybody!

Looks like it will consolidate for the early part of this week. I just learned that with a -116-pip loss earlier that started-off my trading week.

One currency that caught my attention is the Swiss Franc. Let's take a look at what's up for this currency:

PPI m/m this afternoon - expected to be up 0.1% vs previous month's -0.2%. It could move the dollar-swiss pair higher if it prints out grimmer than expected or kick it down if it comes out better.

Industrial Production tomorrow - expected to drop by -11.7% from the previous quarter. Yep, you read it right... a whopping 11.7% drop. Whenever you get industrial production down that big, it's bound to ripple into other parts of the economy --- unemployment, inflation, etc - ultimately leading to impact on that country's currency.

I'm not really sure if this has been baked-in on the current pricing of the pair but if it does print-out like the disaster it's expected to be, then the USD/CHF pair will definitely be shaken. So, I'm keeping a close eye on this tomorrow. Expect heavy movement to start when the Europeans wake-up around 2pm, Manila.

June Trade # 17 - BUY GBP/USD

June 15, 2009 1:44 pm (Manila)

Trade is out at -29 pips/lot for a total of -116 pips.

I'm cutting my losses and will look to re-enter when the opportunity arises.

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June 15, 2009 10:56 am (Manila)

BUY GBP/USD @ 1.6387

STOP – 1.6339

Limit 1 – 1.6407

Limit 2 – 1.6527

At 8:30 pm today (Manila), US Empire State Manufacturing Index comes out which should be bearish for the dollar.

Just gunning for 20-40 pips.