UPDATE: Kiwi is ripe, don't give it a squeeze
This was not my finest hour. The original Trade Idea expected the long term NZDUSD downtrend to prevail, despite NZDUSD rallying after the terrible nonfarm payrolls report.
The trade idea also anticipated that Janet Yellen's speech on Monday would have been on the hawkish side, in support of the prior Fed speakers. It also expected that the RBNZ would take advantage of a likely delay in a US rate hike to cut the OCR rate.
It wasn't a totally off-the wall expectation as the odds for a rate cut were around 35%.
So what went wrong? Pretty much everything. To start with it was a counter-trend idea. The intraday uptrend, in hindsight, was warning of an uptrend.
Then it gets worse. Janet Yellen was Janet Yellen and delivered remarks closer to dovish than even neutral. That result turned the trade into a rate cut bet which at best had only a 35% chance of success. That kind of trade needs some supporting technicals and in this case, there weren't any.
And the most foolish thing of all was changing the stop loss to 0.7072. All that accomplished was to increase the loss by 0.0032 points. I should have known better. NZDUSD trades in a rather thin market at 2100 GMT when the rate announcement is made. If 0.7040 was going to deal, so was 0.7072
This idea went belly-up pretty quick and resulted in a loss of 0.0115 points.
Note: the second sell order was filled.
Original trade idea parameters
Entry: Sell ½ position of NZDUSD at market (Currently 0.6935) Balance at 0.6985
Time horizon: Five days
— Edited by Adam Courtenay
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