*Position Update: At 04/29/2015 @ 23:07 EST The Global Currency Scalper liquidated 75% of the correlation trade between USD/JPY & USD/CAD. The USD/CAD long was closed at 1.20260 picking up 12.6 Pips and the USD/JPY short was closed at 118.733 for a profit of 20.7 Pips giving us a total of 33.3 (24.9) Pips of profit. We will hold 25% of our position while the correlation narrows over time.
As of 04/29/2015 @ 20:30 EST:
The Global Currency Scalper has identified a possible opportunity in a correlation trade between USD/JPY and USD/CAD. The trade: Long
USD/CAD and Short USD/JPY.
We will be initiating a position in a correlation trade
between USD/JPY & USD/CAD. As you
can see the correlation has widened to approximately 450 Pips but over the past
year we have seen these pairs spread as wide as 1,200 Pips. With that said we will slowly build into our
position, initiating just 25% of our ultimate size. If the spread continues to widen this will
give us an opportunity to lower our cost basis.
If the current width of the spread happens to become the max over the
next few days or weeks we will still participate by having our 25%
position. This evening we will get the
interest rate decision from the Bank of Japan which may present an opportunity
to add to our position.
Trading a correlation strategy greatly reduces any
directional risk one takes when taking a normal long or short position. Over the past year this pair has an 87%
correlation which gives us great odds of having a profitable trade. Proper money management combined with solid
odds gives you staying power in the trading business.
No comments:
Post a Comment