On April 10th we updated you on the AUDJPY trade we made in the managed forex account in a post called (Managed Forex Account – AUD/JPY Taking a Profit) where we had sold half of our 2% capital position after gaining 1,000 pips and to give us an 8% gain on the overall account.
We are still in this trade but have seen the AUDJPY fall back down over 500 pips on a pull back, this was somewhat expected as it had such a strong rally. The chart still looks very good at this point with nothing to make us to worried.
We remain in this position as the trend still remains above the trend line. As of right now our stop loss is at 64.65 which would be a sell signal and a change in the trend. The stop also does guarantee us at a minimum a 250 pip gain on the trade.
The EURJPY trade that was entered in the forex managed account last week in the post (Forex Managed Account – EURJPY Going Long) has now been stopped out. As you can see on the chart it broke previous support where we entered the trade giving the first sell signal in the new uptrend.
We had only placed a small trade of 1% capital on this trade due to our exposure already in the AUDJPY trade. We had a quick stop loss of 100 pips that did not hold. As of right now the up trend is still in place for the EURJPY.
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We tried to make an entry into the EURJPY around March 14th but never got the pull back we were waiting on to make the buy entry. You can view that post at (Forex Investments and Managed Forex Account – Long EURJPY). Since then the EURJPY has continued its upward move but has recently given us a good entry point on the recent pull back.
Looking at the chart below you can see that since breaking above the trend line it has made continuous higher tops and higher bottoms which is very bullish. The currency pair has now fallen back to previous support and it is again near the trend line which will also act as support.
We have already entered this trade at 126.90 and have placed a stop loss at 125.90 for a 100 pip stop. The stop is placed at the sell signal of the previous row of O’s on the chart, this would be considered a quick stop loss as the trend would not have been broken yet. We would rather use a quick stop loss on the entry as we can always find another entry point if we get stopped out.
The risk on this trade is 1% capital instead of the normal 2%. This is because we still have a position in the AUDJPY (Managed Forex Account – AUD/JPY Taking a Profit) of 1%. We do not want to get over extended against the JPY even though we are using different cross pairs.
If you like our technical analysis on the forex market be sure to read all our forex managed account trades on our blog and learn more about investing in foreign currencies with us.
As you know we have been long the AUD/JPY for about 1 month now. You can read all of our post so far on this trade at the following links (Forex Investing – AUD/JPY Trend Change – Go Long) (Forex Investments – AUD/JPY Update) (Managed Forex Account – AUD/JPY Update).
The trade has gone very well for us and a few days ago we took our first profit. We entered the trade with 2% capital risk at 62.15 and an initial stop at 60.90. We have moved our stop up to 64.65 which would be a sell signal and a break of the trend line.
We sold half our position at 72.15 and the trade so far has made us 1,000 pips. Because our initial stop loss was 125 pips and we took a 2% position with a 1,000 pip gain we have made 8% on the account in one month plus we still have half our position. If we had sold all our position we would be up 16% in one month while only risking 2% of capital.
From here we will stay in the AUD/JPY trade as long as the trend line is not broken and we will continue to move our stop loss up as the trend continues up.
If you like our technical analysis on the forex market be sure to read all our managed forex trades on our blog and learn more about forex investing with us.
This week has given us some big changes in the 1% point and figure charts. This chart is considered longer term so any changes in the trend is a big deal. It looks like the Japanese Yen (JPY) is getting weak and that is where we see many of the new trend changes. It also looks like the Australian dollar and the New Zealand Dollar are gaining strength against the major currencies. We have already talked about the NZD in our last post (Forex Investments – NZD/USD Trend Change) so we will focus on the other trend changes happening.
The AUD/USD has recently given us a buy signal above the trend line to confirm the trend change. We had talk previously about AUD/USD trend in both the post (Forex Investment – Has the AUD/USD Trend Changed?) and (Managed Forex Account – Has the US Dollar (USD) Trend Changed?) and in both we were waiting for confirmation of the trend change and we now have that. Looking at the chart you can see it has made a strong bounce up and we will now wait for a better chart pattern to occur before considering taking a position.
The GBP/JPY gave a buy signal above the trend line last week before pulling back exactly to the trend line and bouncing up to make another buy signal. This chart is in a very bullish trend right now as it continues to ride up the trend line.
The CAD/JPY has also given a buy signal above the trend line as you can see on the chart below.
Like all the previous charts the CHF/JPY has a very similar story. The chart shows a buy signal above the trend line confirming a trend change.
The NZD/JPY has now given us 2 buy signals above the trend line confirming the trend change.
It looks as though the Yen (JPY) strength we have seen for many months is now turning around. At this time we are going to stay with out current position of being long the AUD/JPY as you can see in the post (Managed Forex Account – AUD/JPY Update).
If you like our technical analysis be sure to look at our other post on our forex investment blog and also take a look at our managed forex account.
The New Zealand dollar has seen a strong rally over the past 3 weeks from below .50 to above .58. This has caused some major changes on our 1% point and figure chart on the NZD/USD as it has broken through the trend line set back a year ago in March of 2008 when the pair was above .82.
Looking at the chart we can see that this week we have seen a buy signal given above the trend line which is confirmation that the trend has changed. We however will not be entering a position now as it seems over extended and will wait for some consolidation or a better chart formation to enter a position.
This is the first major currency to have confirmed a trend change against the US dollar (USD) since the big USD rally we have seen over the past year.
If you like our technical analysis be sure to take a look at our other post on our forex investments blog and our managed forex account.
The AUD/JPY trade we entered 3 weeks ago that you can see on the blog posts (Forex Investing – AUD/JPY Trend Change – Go Long) and (Forex Investments – AUD/JPY Update) has done very well so far. We entered the trade at 62.15 on a pull back to the trend line and have now seen it rally as high as 69.60 before having another pull back.
Looking at the chart we can see a perfect example of a shake out pattern. A shake out pattern occurs when you see a chart that is in an uptrend form a double top and then falls to make a sell signal. This all has to happen while staying above the trend line as we see it has here. When the chart then makes a reversal back into X’s that is what we call a shake out pattern and is very bullish. What happened is all the weak buyers got shaken out of the trade but now it has found a stronger base and can continue its upward momentum.
Now that we have had a pull back to the trend line and a reverse back up we can move our stop loss up to 64.65 which would be a break of the trend line. So far the AUD/JPY chart patterns look like it can keep going higher so we will be staying in the trade until the trend changes or the chart tells us something different.
If you like our technical analysis using point and figure charts be sure to take a look at our forex managed account and our other post on the forex investing blog.
