“Being Pre-occupied with not losing interferes with winning. Trading not to lose is not a good strategy. You need to trade to win.” Ari Kiev Trading author & coach.
This morning I am taking a loss in NZDUSD. Not only did the central bank raise rates as expected but the commentary was quite bullish, and while I think it is all a bit strange considering the environment in their major trading partners, my only business is with the price which is moving against my short position. Therefore I will stand aside. Looking back, with the clarity that comes from exiting a losing position I can see that I entered a position essentially in a sideways market without using RSI or some other oscillator to help me pick my spot, convinced of the fundamental weakness of commodity fx and the cyclicality that meant that this would sooner or later apply to Kiwi. While I might ultimately be proved correct, I can no longer participate in this trade. We learn more from out losers than our winners!
Having broken multi-year resistance EURUSD is beginning to make some progress to the upside now. I don’t have a recommendation here because as I said before, I see a disparity between the fundamentals and the technicals, and in my view the best trades are when the fundamentals and the technical picture line up and give me confidence in the trade. Daily RSI comes in at 69 now. The next target on the high side is the Oct 2011 level at 1.4174. A break and close below 1.38 would cast doubt on the recent breakout.
I need not have had any worries about USDJPY getting away from me and it sits this morning at 102.60 comfortably below 103.50 that would have gotten me long before a pull in to the 200 day SMA at 100.00 I still find it odd that while EURCHF has 1.21 in its sights again, USDJPY has not been able to get lower too being risk correlated too. However I’ve learned today that my business is with the moving price and technical set up versus the fundamental picture and not exclusively with one or the other. - See more at: http://www.fxlight.co/daily-fx-forecast-2