BombayBulls
Long

Forex - What Difference A Day Makes?

FX:EURUSD   Euro / U.S. Dollar
Fed was on the verge of rising the rates ( or may be still they are ! ) and market was bracing for the event. Monday made a mess of all those good looking charts and left sharp candles all over the place. Now what? Once can sell dollars with an argument that Fed is going to be on hold but then what else is there to buy? BOE (Bank of England) can also delay raising rates ( and looking at today's price action traders have already started pricing that ). AUD and NZD have their own problems and it's more about cutting rates than rising. Canadian dollar             can be sold further based on the expectation of $30 oil             but that's a stretch if no other bank is about to tighten. EUR is more about unwinding long dollar positions than its own strength so need to be cautious chasing it above 1.1500. We have been trading EUR from long side and still that's the trade de jure. In our last trade we got long near 1.1100 but unfortunately got out with just 200 pips profit ! :( and it rocketed to 1.1700 !! :D
Still the situation is fluid and we are not gonna hang our hat on any particular levels yet because trading in such environment is all about imaginary risk control, in another words - gambling. But depending upon the time of the day if the price action is near 1.1300 or 1.1200 then we might think about trading it from long side with tiny position and tight stop loss. It all depends upon how it gets there and how the price action feels near those level.
UPDATE : Booking partial profit here at 1.1350 and moving the stop loss. Dollar index may take a leg down towards 94.75 ( and that corresponds to euro somewhere near 1.1400 ) but also there is possibility that it can find support right hear at 95 and start the the journey upward. Let's see how the remaining position behaves. As mentioned above, we are also prepared to take a trade from 1.1200 if it collapses and price action is constructive there.
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