Historically, the Memorial Day Monday is uneventful for currencies on the account of financial markets being closed in the USA. In the past few years very little happened on this day and tomorrow should be no different. There are no scheduled fundamental announcements of any significance on the calendar even before the New York session, which is another reason for markets to be quiet. Of course, new developments in Europe could wreck this scenario, but they would have to be real, rather than just another opinion whether or not Greece will be excluded from the monetary union.

At any rate, we should have a good indication of the day is going to bring at the opening. Gaps would suggest at least some volatility, while their absence might mean quiet day ahead. If gaps develop, they could present short-term trading opportunities, depending on their size and the currency pairs involved. Other than that, it could be a good day to take it easy, at least for me, which makes it a good time to update some of the trades discusses here before my prolonged absence.

Just about the strangest trade I have taken perhaps ever was a buy in the EUR-CHF. In early April, I bought it at 1.2010, with an objective of 1.2070. At that time, I expected this trade to be slow, lasting maybe 2-3 weeks. However, it was not until last Thursday that volatility returned to this pair, finally pushing the price high enough to reach my target, if only briefly. Now I have no further interest in this cross, since the prolonged contraction makes it virtually untradeable from technical perspective. Besides, with the Euro acting the way it does, who knows if the SNB will be able to maintain the 1.20 floor, in spite of their “utter determination”.

In the same post, I also discussed a short in the NZD-JPY. Bearish pressure had been building up in this pair for some time, only held up by a support at 66.40. A downside breakout would start a major selloff, or so I thought, setting a target of 100 pips for this trade. Unfortunately, the initial move just missed my estimate few pips and I got out with profit of 55 pips. However, soon after, the price formed another solid support at 65.40, which I used for another short entry. This one worked out much better, bringing 120 pips in a few days. That, of course was only the beginning of a much larger selloff, which pulled the NZD-JPY below the key 60.00 level.

Much earlier, I discussed possibility of major bottoms forming in the GBP-AUD and the GBP-NZD. Originally, I went long the GBP-NZD, using 4H chart. Later on, after that first initial move, I also bought the GBP-AUD, this time using its daily chart. This trade produced 500 pips, although the price appreciated again since my exit. There have been plenty of other developments in the past several weeks, which I will try to cover in coming days. Have a great trading day!

Mike K.