EUR/USD (Long)

There has been much talk about the creation of a 'bank' to soak up all the toxic assets and ease the credit crunch. If this plan get the go-ahead, traders will likely dump the current safe asset currencies like USD and JPY and go for other higher yielding currencies. I decided to take a long position on EUR/USD ahead of the FOMC meet. It will be a half position at 1.328 just below a key resistance of 1.33. If this resistance can be convincingly broken, the pair will likely move above levels of 1.35. Stop loss is set at 1.316, 120 pips below my entry. The pair currently trades at 1.326. Wish me luck!

Update 1
USD performed mixed against other currencies following the Fed's release. Unfortunately for me, EUR nosedived immediately following the announcement to my stop loss. I took a 120 pip loss today. Re-examination of my trade tells me that perhaps 120 pips stop loss may be too excessive. Remember, we always want to keep our losses small and let our wins run