Fading EUR/USD rally

EUR/USD has rallied on the Greek bailout news, but it has also reached resistance level at 1.14430

Just shorted EUR/USD @ 1.4400
Stop 1.4455
Target  1.4320






UPDATE (11:35 AM PDT):
EUR/USD currently @ 1.4384 and its been going side ways all morning. This is not the kind of action I was expecting. Moving stop bellow break even to 1.4398.

I want to abort the trade if the market rallies.



UPDATE (13:10 PM PDT):
I didn't want to carry this trade after close.
Closed out short @ 1.4392 for 10 pips profit.
Will go back to sidelines and wait for a better trading opportunity.

Stopped out of EUR/USD

Got stopped out of EUR/USD trade for a loss of -115 pips

Market went up to 1.4210, took out my stop, and then dropped by 120 pips. WTF???

Now that I think about it, that was a bad place to put a stop. I need to get in a habit of picking good stops based on support/resistance levels instead of putting arbitrary stop/exits at round numbers like 1.4200. The next big resistance was at 1.4239, so a stop above that would have been better.




Night UPDATE (10:30 PM PDT):

It looks like it was a good thing that I got stopped out this morning, because EUR/USD has broken out of the hourly down trend line and has now rallied above the 1.4239. Next big resistance is at 1.4340 which is the 38% fib retracement from the top made in early May.

Dollar is back on the defensive again, with risk carry trade back on. I am still in sell the rallies modes, but thinking about stepping back a little bit and letting this market settle down from the recent big sell-off. Many of the markets look oversold on the short term charts, so they are susceptible to sharp bounces.

Early Morning EUR/USD Trade

Just shorted EUR/USD @ 1.4085
Stop @ 1.4200
Target @ 1.3700 (will adjust later)

Now I can go to sleep :)

EUR/USD

Planning on shorting EUR/USD on any rally we get tonight. Hoping to get a short in around 1.4100 area. Currently at 1.4036.

Dollar

Nice inverted head and shoulders on the DX. Technically, the Dollar is ready for a big rally. The only thing it needs is a spark to set it off, and that spark is going to come from the EURO zone. Another Euro debt panic is brewing at the moment. S&P just downgraded Italy. I am watching the situation in Spain closely.

If the Dollar rallies, it will be bad news for all risk trades (ES/EUR/CL). We might see a massive unwind like we did in CL at beginning of the month. I am still not sure which instrument would be the best to play this off. I think CL has dropped too much in May to provide good shorting opportunity. I've been burned shorting ES too many times in the past. I think EUR/USD is probably the best shorting bet.

Sunday Night - Crude

CL has broken out of the descending triangle but it still looks weak. I doubt this is the bottom. The problem is that we went down too far, too fast at the beginning of May. The big crash flushed out too many long positions, so selling pressure has been relieved.





On the other hand, Brent/WTI spread is still high, signaling bullish pressure on Brent.









The bullish season for CL usually ends in May and the market goes side-ways until it rolls over and turns bearish around September. We are either going further down, or will consolidate for a few weeks. I’ll definitely be selling the rallies.