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<b><span style="text-decoration: underline;">1. INTRODUCTION:</span></b>

Since last weekend’s blog “The Weekly Fx Drive-Thru” the JPY has not played out the way that I was anticipating.

For now, it’s a bummer, as I really wanted to pick up the USD/JPY long below the 97.00 level. Just remember, we are still in the daily chart triangle range and until we break either 97.00 to the downside or 99.00 to the upside we are stuck. The chart is a bullish pennant and we should see a break out to the long side, but, if the FED continues to buy bonds and mortgage backed securities, yields will fall and this should place the USD/JPY under pressure, and, it should drop. Bear this in mind; my trade idea of the USD/JPY long at 95.00 may still come into play. You just never know.

Moving on, today (Wednesday) we have a “market moving” event, the release of a FOMC meeting statement. The big news around this statement are comments relating to tapering, whilst I do not think that we will see tapering in 2013, you just never know. We may get a surprise from the FED, I doubt it, however, as traders we have to be ready to trade whatever the hand is that we are dealt.

With the FED release, it is normally advisable to close all USD related trades, as volatility can be terrific.

I am currently long the USD/CAD (one of my live trades) and I have been for some time. I am debating whether or not I should close it or not. I probably will later this morning before the announcement. I will tweet my actions.

My radar trades at the moment are limited in number until after the minutes are released and the dust settles, however, I have two trades in mind that work either side of the market reaction to the FED (See “Trades on my Radar” section 3 below).

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<b><span style="text-decoration: underline;">2. EXISTING LIVE TRADES:</span></b>
<p align="center"><b>EUR/CAD
</b><b>Long
</b><b>Position Size: 40%
</b><b>Entry / Cost Average: 1.4407
</b><b>Stop Loss: 1.4310
</b><b>Limit / Take Profit: 1.4800
</b><b>Present Position: - 42 pips</b></p>
<p align="center"><b>EUR/AUD
</b><b>Long
</b><b>Position Size: 20%
</b><b>Entry / Cost Average: 1.4464
</b><b>Stop Loss: 1.4360
</b><b>Limit / Take Profit: 1.4950
</b><b>Present Position: + 5 pips</b></p>
<p align="center"><b>USD/CAD
</b><b>Long
</b><b>Position Size: 20%
</b><b>Entry / Cost Average: 1.0416
</b><b>Stop Loss: 1.0330
</b><b>Limit / Take Profit: 1.0850
</b><b>Present Position: + 29 pips</b></p>
<b><span style="text-decoration: underline;">3. POTENTIAL TRADES ON MY RADAR:</span></b>

I have several limit/stop orders with my broker that I am comfortable to leave in place through the FED release. These trades are to enter long or short at key levels, and they are very small trades to try to establish positions with. Stops are fairly tight on all of them.

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<p align="center"><b>USD/JPY long at 94.80</b></p>
<p align="center"><b> </b><b>USD/CHF long at 0.8870</b></p>
<p align="center"><b> </b><b>AUD/USD short at 0.9560</b></p>
<p align="center"><b> </b><b>NZD/USD short at 0.8340</b></p>
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<b>EUR/USD:</b>

My FOMC trade involves the EUR/USD. In recent blog’s I have often referred to the range that the EUR/USD has been caught within for quite sometime. My trade is simple as nothing with forex is complicated.

The trades are based upon the market reaction to the FED statement. If it’s a dovish statement I look one way, and if it’s a hawkish statement, I look the other way.

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<p align="center">The <b>EUR/USD</b> range that I am looking at is 1.3710 to 1.3850.</p>
<p align="center"><strong>TRADE 1:</strong>
If the USD weakens, which is my preferred trade. My goal trade is to short the EUR/USD around 1.3900 and keep adding to my short should it run up to 1.4000. I am looking for a move back to 1.3450 in the coming sessions.</p>
<p align="center"><strong>TRADE 2:</strong>
The opposite trade is to short at 1.3710 should the USD strengthen. I would let the pair break through and then short on a re-test of 1.3710. Remember what was previous support (1.3710) would become resistance if we fall through this level after the FED announcement.</p>
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<b>AUD/NZD:</b>

Additionally, I also have one other trade set up in mind. Following the announcement last night that Moody’s (U.S. Rating Agency) was discussing the possible removal of the AAA rating of New Zealand debt based upon its current account deficit and it’s ability to cope with major shocks to it’s economy.

I am looking to trade the AUD/NZD long. However, I am going to try to wait until after RBNZ governor “Wheeler the dealer” makes his announcement later today after the RBNZ rate statement and overnight cash rate confirmation.

Proposed long entry level around 1.1460.

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<b><span style="text-decoration: underline;">4. FINAL THOUGHTS:</span></b>

I find it very difficult to keep my hands off the keyboard when I know that I am going to be placing new trades later on in the day. Big news events days are always a little more nerve tingling.

No one knows what is going to happen. Will the FED be dovish or hawkish? The fact is there will be many people with opinions. As a forex trader I know what I am going to do after the news is released. The key is to wait and be patient for your entries to trigger. Let the trades come to you, remember, If you have a plan stick to it.

Trade with this in mind and trade carefully.

Good luck and take care.

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Scott Pickering
The Pip Accumulator
Wednesday October 30th 2013

FOLLOW ME AT:
Twitter: @pipaccumulator

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