Trade view / 16 January 2014 at 8:39 GMT

USDCHF to correct lower below 0.9076 intraday

Trade idea background

USDCHF is coming off the Asian-session highs after an inability to find sustained buying interest above the 0.9094 area. This is the the 76 percent retracement in the latest short-term wave of 0.9127-0.8985. We now expect a potential exhaustive pattern on the upside to emerge if the spot manages to break through the 0.9076 level in intraday trading. We will only establish short positioning in USDCHF at the break of that level, however.

Trade management and risk description

We choose to keep the overall risk exposure in check in this trade set-up and size the entry order as a half-nominal trade-size order. The trade will also be protected with a tight stop-loss order, which will be adjusted to entry once the first profit target has been reached. 

Trade idea parameters

Entry: sell half-size order USDCHF stop offer at 0.9076.

Stop: buy USDCHF stop bid at 0.9089.

Target: first target is at 0.9062, where we will lock in half gains and move the stop to entry. Second target is at 0.9038. 

Time horizon: intraday.

Short-term USDCHF chart

USDCHF Short Term

Source: Saxo Bank

5-year USDCHF chart

USDCHF long term chart

Source: Saxo Bank

Disclaimer:
Non-independent investment research
This investment research has not been prepared in accordance with legal requirements designed to promote the independence of investment research. Further it is not subject to any prohibition on dealing ahead of the dissemination of investment research. Saxo Bank, its affiliates or staff, may perform services for, solicit business from, hold long or short positions in, or otherwise be interested in the investments (including derivatives), of any issuer mentioned herein. » Read more

(mo)

16 January
Kert Kert
filled and all the best! :-)
16 January
Kristian Siggaard-Jensen Kristian Siggaard-Jensen
First target is now done. Stop moved to entry on the remainder and looking for target 2.
16 January
Eric Hammond Eric Hammond
Hi Kristian,

I'm still learning the lingo here. Why do you suggest for example "buy USDCHF stop bid at 0.9089" rather than a stop entry?

Also when you say "look in half gains", you mean buy half of my original order?
16 January
Kristian Siggaard-Jensen Kristian Siggaard-Jensen
Hi Eric, The reason why I always suggest "buy stop bid", "sell stop offer" is to (if the markets are moving rather fast) to minimize the amount off slippage. So for example with the USDCHF and news came out and you just had a stop order to buy and the spread goes to 0.9087 bid 0.9096 offer you would get filled on a trade, but the actually price that you are looking for has actually not been in the market. And yes half gains is half the position on the original order. So for sell orders above market so always want to make sure the bid price has been done and offer when you sell below the current market price
16 January
Kristian Siggaard-Jensen Kristian Siggaard-Jensen
Eric, last sentence should of course have said for buy orders above markets make sure the bid price have been done. Apologies
16 January
Eric Hammond Eric Hammond
Thanks a lot for the clarification. My trade closed out unfortunately.
16 January
Kristian Siggaard-Jensen Kristian Siggaard-Jensen
This trade is now square

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