This trade doesn't look like it will be as successful as hoped. The original trade idea
expected USDCAD strength to emerge from weaker-than-expected Canadian economic data this morning and on rumours of month-end buying of USDCAD for portfolio rebalancing purposes.
Today's data was better than expected which negated on trade idea negative. The USDCAD trading performance so far this morning suggests that, if there is USDCAD buying for month end, the dollar amount is not that significant, reducing the topside because unless 1.3075 resistance is overcome, a retracement to 1.2900 is highly possible.
For all of the above reasons it is prudent to cut 1/2 of the outstanding position at market (1.2984 (the break even on the two positions that were filled is 1.29665)
Raise the stop loss on the balance to 1.2945 and lower the take profit to 1.3020.
Note: This trade requires contstant monitoring on the approach to 1600 GMT and should be closed at that time.
It is never a good idea to get married to a position and although this idea was initiated with grand dreams, the dream is proving to be delusional.
Entry: Buy 1/3 position of USDCAD call at market (currently 1.2988), 1/3 at 1.2945 and 1/3 at 1.2910.
Time horizon: five days.
USDCAD 15 minutes
Source: Saxo Bank
— Edited by Martin O'Rourke
Non-independent investment research disclaimer applies. Read more