The Anticipation Before and Quick Thinking after Today's Stress Tests Defines a Trader
There is a lot of pent up event risk before the EU drops the bomb on the market. While there are reversal and trend revival opportunities out there; those are setups for more calm market conditions. We don't have many trading hours left in the week; so I am taking stock of possible breakout candidates. And if we don't get a breakout before the weekend, all the better. I think a break after reflection just increases the potential for follow through. A quick stock of those pairs I am looking at for this event. EURUSD could extend its run above 1.30; but there is a good opportunity for a steeper retracement below 1.2750. EURJPY is a consistent one with a ceiling at 113.35. GBPUSD is stations between two very large levels at 1.55 and 1.5150. CADJPY is creating short-term technical levels to work with; but the long-term and gradual rising trendline is my main concern. And, my favorite potential breakout opportunity is USDCHF on a break from 1.0550/0400 congestion following a very steep and consistent decline. A correction is long overdue.
For my currently held positions, only two survive. The remaining half of my AUDCHF short was knocked out at breakeven this morning on a delayed follow up to AUDUSD's impressive breakout yesterday. As for the other trades, they are still floating. The CHFJPY short is highly prone to the forthcoming event risk; which is to be expected. In hindsight; I should have reduced position size ahead of this event risk when I slipped back to breakeven; but we don't trade in hindsight. My stop is set at 84.60. As for my USDJPY long, we are stuck between 87.50 and 86.50. A bearish break will just encourage me to add to the small position size I have. Since this is for a longer holding period; I'm not too concerned about this pair ahead of the Tests.
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