Tuesday, November 25, 2008

11-24 EUR/USD Trade




While vacationing with my family, I sat down at my laptop yesterday evening and pulled up a EUR/USD chart. I skyped a fellow trader to ask what the stimulant was in the market that caused such a bullish move today. He informed me that Citi had been bailed out and that the market liked it. Stocks up....Eur/Usd up, that seems to be the theme over the last few months. I started looking to see where a possible bouce could occur. I went to the 4 hour chart and noticed that although we have had several attempts at the 1.2950 level, we had not quite "reached" it over the last few weeks once it broke. It also lined up nicely with the 62% retracement of the swing of the high at 1.3295 to the low of 1.2388. Looking at the 1.2950 I could see a very nice TSR area where support and resistance was evident. I was watching price when it was at 1.2912, waiting for a surge up. It was sitting right near the previous week's high at 1.2926 and in the past I would have traded it there. I really wanted to see it surge through to the 1.2950-60 level, and it did. I had an order at 1.2956 but did not get filled there. I watched price and when it did not hold above that level, I traded a pull back at 1.2942. My drawdown was very small and within an hour or so I had profited and left some in the market in anticipation that this might be a good pull back for a lower move. No one knows at this point and that's why I only have 10% remaining in this trade.