Probably most important single news item regarding currencies came from New Zealand. The Reserve Bank cut interest rates yet again, this time by 150 basis points. This is an aggressive move, exceeding expectations of 100 points. News sent the NZD down across the board, setting new 6 year low against the USD. Reports suggest long list of reasons why Kiwi went sour, but I’m skipping them, because at the moment I simply don’t feel like bother myself with fundamentals. Of most interest to me was possible influence over my NZD trades/orders. For example, the trade I suggested yesterday, in AUD-NZD is effectively cancelled. Interestingly enough, Kiwi hit the skids for good yesterday, right after my post. That was in response to FED announcement. One could have thought RBNZ was deliberating yesterday. This brings me to the trade I was setting my eyes on all week long, a buy in NZD-JPY.
Order was filled shortly before FED decision. Japanese Yen had been responding strongly to these announcements lately, so I closed other JPY trades before. This one was left alone, but I put 80 pips hard stop, which was hit very fast. I also cancelled the second buy order at 46.00. This level was reached just minutes ago and is most likely a good place to get in long, but I won’t be able to baby sit it, so I’m passing. There will be other trades next week.
Early in a week, in a post Forex rumors, I brought up a longer term trade in GBP-JPY. Premise was to buy an up move above previous daily candle. This happened that very day.
On this platform it happened to be 123.00 level. Yesterday, right before, FED announcement, I closed half of this position for almost 540 pips gain. Trade size was twice what I normally would take in relation to account balance and was making me a little uncomfortable. Now I can let it be, profit has been insured. Original objective was 136.00 and, for now, remains unchanged.
There will be no update neither tomorrow, nor on Saturday. I’ll be back Sunday afternoon, but it is possible that update will be made before markets open. Like all Forex junkies I travel with a laptop. Well, lunch here but dinner in Victoria.
Enjoy your trip. I’ve been there twice. Always fun.
Hope you will unwind fast. Have fun.
This is a great trade, gbp/jpy. Over 500 pips in couple of days. Very nice.
Mike, you know I followed your eur/gbp trades with interest, because was in this pair also. Have to tell you this was very impressive to watch it. Wait, wait and then 3 trades in 2 days for 250 pips. And done. Clinical work and fun to witness, too.
While you are relaxing Pound went on a move. You are missing out…
So, pound had a nice run. Perhaps Soros was right. What do you think?
Thank you all for nice comments. It’s been fun.
I hope Soros is right…
[…] For some time I’ve been carrying a GBP-JPY position. It is described in greater details in Sour Kiwi. It was based on daily chart and a week ago I exited half position. Today I closed the rest. […]