The NY session has given us some wild movements in the last few days. I was away from my desk most of the evening, and missed getting a position in for the US inflation numbers by mere seconds, and I wasn’t able to check my phone sooner. However the opportunity loss was tempered by a separate trade I’d entered earlier in the evening, also while away from my PC.
Reasoning: On the daily timeframe all the Ichimoku signals were pointing buy (Chikousen up and far from the price, both A and B spans, as well as the kijunsen and the tankansen sloping upwards), there had been some better than expected Unemployment numbers out of London before their session started with no other major GBP or JPY news releases planned for the day.
Was trying to pick a good entry as the price dipped under the sloped support line, but kept worrying that I’d miss the move. In the end the price did drop to my initial desired entry (186.3) and even a bit lower. So lesson learned here, at least for GBP/JPY is trust the volatility. Pick a entry point and stick to it.
Stop: 185.9 (-50 pips)
I was looking at this being a slightly longer trade than normal, maybe a full day, especially with GDP numbers coming out of Tokyo the following morning, so a slightly wider stop than I normally use. Also it sat just below the Weekly R1 pivot point (185.97) as well as below the psychological level of 186.00.
Lot Size/Risk: 2%
Usual 2% risk, but this means that the lot size was lower due to the wider stop. Still, need to stick to the max risk, regardless of what that means for lot size and expected profits.
Target Price: 187.18 (78 pips)
This was pretty much bang on the daily R3 pivot, with the assumption that if we broke the R2 (186.58) we’d probably see a decent run. Part of me wanted to stick to the psychological 187.00, but with the volatility of the pair, I figured a push up to the R3 might be possible.
I was happy for this to be a longer trade, since some of the signals and stop loss reasoning were based on the D1 charts, rather than my usual H1. And carry wise it would be a positive result too, not to mention there were JPY GDP numbers coming that could affect it as well.