|
NZD/JPY
This morning's release of US Retail Sales resulted in a pullback of the NZD/JPY (and most other USD and JPY pairs). This is where blind faith of the trend comes into play. Traders who still think we are in an uptrend on this pair can buy in this area and place their protective sell stop below yesterday's post US FOMC announcement low in the 64.12 area. What are the chances of this market reverse and continue the move up? Who knows for sure, but we can start with a 50/50 chance. This is why money management is so key to profitable trading. The use of a 1:2 risk:reward ratio makes the 50/50 propositions a solid trading opportunity. If we risk 75 pips on the trade, we should look for at least 150 pips in profit. Trading is really a numbers game where you find these situations and consistently take them. We have no control over the market, but we do control the way we position our trades to take advantage of these emotional moves against the trend. Sometimes we win and sometimes we lose. There is no way around that, so we have to accept it and make it work for us.
__________________
Enroll in our online FX Power Course today and get personalized instruction from our team of expert traders 24 hours a day. We have taught over 25,000 students and in just eight lessons, we will teach you the fundamentals of Forex trading. Click here to get more information
|
