That was some day. And it looks like it isn’t over yet. Right of the bat things started moving and then they just picked up speed. And my trade selection – all wrong. GBP-USD was bought at 1.7625, as planned. it was stopped out at 1.7550 for a loss of 75 pips. I reentered soon after at 1.7700, but within few hours I lost confidence and pulled a plug on it at 1.7743, for negative 27 pips. Proved to be not a moment too soon. Looks like I got off easy.

Trade I carried from before, GBP-CHF was cut short by me. After seeing what was happening in JPY crosses, there was a possibility that CHF might be next “flight to safety” currency. I exited my position at 2.0078, for a marginal loss of 12 pips. That’s break even for all practical purposes.

Story of the day must Japanese Yen. It really put on the show. Some of these moves were all out ridiculous. Let’s take AUD-JPY for example, the pair I was planning a long trade. It fell 1100 pips! I’ve been trading forex since 2002 and I NEVER saw this pair move this much in a day. Last year, during the summer sell off, or the “carry trade unwind”, it fell 800 pips, so today was much more. For me it was big difference- last year I made 500 pips on that day, today I barely avoided losses. My plan was to buy on the open IF there was not a big gap. There was one, about 100 pips, so I aborted the trade.

I placed a buy order above recent highs couple of times during the day, but this last move at about 10 EST knocked the wind out of me and sapped a will to trade. For next few hours, that is.
AUD and NZD got really hammered and I’m not even going to guess at this point what is next for these 2 currencies. I think right now it is dangerous to make strong commitment on either side of them. Frankly, that is the case all over the board. When in doubt- stay out.
Plan for tomorrow is to go to smaller time frames, 5M or even 1M if large moves continue and concentrate on EUR-JPY with a bias to the upside looking for 30-50 pips. After today, next few days may be very anticlimactic-it is unlikely this magnitude of moves continues even though the ranges will still likely be historically high.
All said, not a bad day. Dead wrong in my trades and suffered only minor losses.
Mike K.