Trading currently is very volatile. The invasion of Ukraine and sanctions on Russia have created so much uncertainty that the financial markets are extremely volatile.
Today the CAD was very strong going into the U.S. session overlap and the EUR was very weak. Traders who took advantage of shorting the EURCAD were well rewarded.
As the USD began to gain some strength and the EUR weakened further, a short was taken risking 18 pips for a potential 96 pips to our daily target at 1.0888. I was not expecting the EURUSD to break 1.0900 today but the pair has been very active, so it is possible. Personally, if price bounced defending 1.0900, I would have exited… but it didn’t make it down to the figure while I was trading it.
As the U.S. session overlap began, a brief retracement occurred as the EURUSD moved higher. After 3 bearish candles and two technical levels broken, a short was taken.
I would love to post charts each trading day showing gains of over 20 pips but they have been few and far between lately. Personally, I don’t like giving back profits, so in a volatile market, I protect my profits after getting the risk out of the trade. If a technical or psychological level slows price down, and it starts to retrace, I get out… taking my profit and get back in only if the trade starts to move back in the original direction that I was trading it.
Lately, that has involved a lot of in and out trading for small gains. The gains accumulate over the course of the week though.
Next week, Chair Powell is expected to announce a 25 basis point rate hike on Wednesday. The frothy U.S. economy is experiencing high inflation which is getting worse due to the Russian Ukraine war. The prospect of the E.U. economies slowing dramatically is causing traders to short the EURO especially as energy prices have soared recently. Once again, traders are talking about the possibility of EURUSD moving to par.
This weekend North American clocks move forward so the U.K. trading will be starting and ending an hour later for those of us on this side of the Atlantic.
Good luck with your trading and stay nimble.
