AUDUSD Weekly Chart showing a Bearish Divergence on the Stochastic Oscillator (14,3,3).
Fibonacci retracement of move from March 2020 low to February 2021 high provides a take profit target of 0.74161 at the 23.6% level for this swing trade.
10 yr bond yields moving up in the US relative to significantly lower rates in most other developed countries is bullish for the US Dollar. Large issuance of US Treasury debt needed to fund $2.2 Trillion Fiscal Stimulus is bearish for bonds (bullish for bond yields).
Federal Reserve announcement this morning, Friday, March 19th, that they will be letting Supplementary Leverage Ratio exemption expire on March 31st, led to an immediate move upward move in rates on the 10 year treasury bond as banks may be forced to sell treasuries; a bullish move in the dollar was also seen on Friday coinciding with the move upward in 10 yr interest rates.
Tight stop loss is set 11 pips above the daily high for Friday, March 19th.
Carry on the short is slightly net positive at 0.0475 pips with my broker.
Entry @ 0.77484 Stop Loss @ 0.77830 Take Profit @ 0.74161
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I booked over $2800 in profits earlier around the 0.7711 level earlier. Originally I was short $1,011,500 at an average of 0.77484 but I trimmed that down to short $72,000 at 0.77528. The AUD gapped down on what appears to be volatility induced by a 15% decline in the TRY on news of the central bank chief being dismissed. Since the pair moved so quickly in my favor on unanticipated external factors, I figured it was best to secure the bulk of the profits while still maintaining a short position based on my original view risking a portion of the market's money.
Added two more 1K shorts @$0.76119 (SL $0.77830 TP 0.70550) and $0.76135 (SL 0.80068 TP 0.67680). Now sitting short 3k (total position size now roughly equal to profits booked on this pair this week). Stop loss still at breakeven on 1K short from $0.77530 (TP still @ original target $0.74161).
GCN3030
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@GCN3030, Profit booked on 2k short positions @$0.75894 market testing support here still sitting on one original short 1K from $0.77530 (TP @ $0.74161 SL @ $0.77530).
GCN3030
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@GCN3030 booking profit bow on final 1K position, swap is now negative, standing aside of this market for now
GCN3030
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booked more profit now short just 1K @ 0.7753 stop loss at breakeven
GCN3030
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booked more profit on 11k now short just 10k @ 0.7753 stop loss at breakeven
GCN3030
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stop loss now moved to break even at $0.7753 on remaining 21K short position
GCN3030
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booked another $125 profit @0.77284 on 52K still short 21K but widened stop now to 0.7900 to give this trade some breathing room to be be held longer term with limited risk.
GCN3030
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CME Commitment of Traders report shows leveraged money is long over 40k contracts versus short less than 18k contracts suggesting sentiment is at an extreme portending a reversal in the trend.