A lot has happened today. USD just keep charging forward, as expected, and is likely to do so for some time. The Yen, however, is even stronger and moves in JPY crosses are staggering. GBP-JPY plunge simply takes a breath away. Pound has not been under such pressure for a long, long time. Here is a monthly chart of GBP-JPY, and the last bar is ridiculous, with full week still left in October.
Current candle is as big as the one in 1998, when LTCM collapsed, an event talked about for years after. I’m sure ongoing market developments will be written about, too. The sell off today was so severe, I didn’t have a single trade on 5M charts to the upside. Big fat zero.
Frankly, when I look at this chart I’m amazed that I’ve managed, on balance, be profitable taking only long trades here. As strange as it sounds, I will continue buying short term upside breakouts. With moves that big, any correction, even minor, can produce easily 100 pips.
My position in GBP-NZD was closed.
The market started to turn and I wanted to packet some profit, so the trade was closed at 2.7115, for 495 pips. Market will likely continue lower, but taking profits here felt like a right thing to do. Especially since my other trade didn’t work out.
This trade didn’t work. I was wrong and about 3 hours after entry 75 pips loss was taken. Well, tomorrow is another day. In all honesty, after today’s moves I really would like to see the ranges to contract a little. So it looks like tomorrow is only GBP-JPY upside breaks for me.
Mike K.
