📌 February 17 – USD/JPY Plummets on US CPI! Reaffirming the Importance of Risk Management
📌 February 17 – USD/JPY Plummets on US CPI! Reaffirming the Importance of Risk Management
✅ Weekly Trading Results (February 10 – February 14)
📉 Total P&L: -90,113 USD
🚨 Main Stop-Loss Trades
- EUR/USD Short at 1.0330 → Stopped out at 1.0412 (-82 pips)
- USD/CHF Long at 0.9146 → Stopped out at 0.9093 (-53 pips)
✅ Only Profitable Trade
- AUD/JPY Long at 96.62 → Closed at 96.80 (+18 pips)
📌 Market Characteristics
- Stronger-than-expected US CPI → USD buying trend
- Subsequent sharp decline in US long-term yields → USD selling and JPY buying intensified
- Ukraine ceasefire negotiations → Risk-on sentiment boosted EUR and AUD
- Gold (XAU/USD) surged significantly → Continued inflows into safe-haven assets
- Bitcoin (BTC/USD) surpassed $100K but entered a correction phase
📌 Biggest Mistakes
- Failed to capture the sharp drop in USD/JPY
- Misjudged the uptrend in EUR and GBP
- Position sizing and risk management were inadequate
📌 Last Week’s Market Overview (February 10 – February 14)
🎯 1. USD/JPY
📉 Trend: High volatility and sharp decline
🔎 Market Movements
- US CPI exceeded expectations, pushing USD/JPY up to 154.80
- Then, US long-term yields plummeted, bringing USD/JPY down to the 152 level
- BOJ rate hike expectations also strengthened JPY buying pressure
🎯 2. EUR/USD
📈 Trend: EUR buying momentum
🔎 Market Movements
- EUR surged on Ukraine ceasefire progress
- USD weakened, lifting EUR/USD to the mid-1.04s
- Reduced ECB rate-cut expectations provided support for the euro
🎯 3. GBP/JPY
📉 Trend: Wide fluctuations
🔎 Market Movements
- BOE's 0.25% rate cut decision led to GBP selling
- GBP rebounded on risk-on sentiment
- Dropped to the 188 level before recovering to around 193
🎯 4. Gold (XAU/USD)
📈 Trend: Steady uptrend
🔎 Market Movements
- Geopolitical risks and Fed policy uncertainty drove demand
- Remained strong throughout the week, though some profit-taking occurred by the weekend
- A short-term correction is possible, but buying dips remains a viable strategy
🎯 5. Bitcoin (BTC/USD)
📈 Trend: Correction after surpassing $100K
🔎 Market Movements
- After breaking the $100K mark, BTC faced short-term profit-taking and weakened
- A push above $110K requires new catalysts
- Continue applying a "buy-the-dip" strategy
📌 Outlook for the Week of February 17
🎯 1. USD/JPY
📉 Trend: Range-bound trading expected
🔎 Key Factors
- Japan’s January CPI on the 21st → May strengthen BOJ rate hike expectations
- FOMC Minutes (Jan 28-29) → Assessing the possibility of Fed rate cuts
- US-Japan Summit → Trump’s potential remarks on “reducing US trade deficit with Japan” could drive JPY appreciation
🎯 2. EUR/USD
📉 Trend: Weakening
🔎 Key Factors
- Progress in Ukraine ceasefire talks
- ECB rate-cut expectations may cap EUR gains
- German general election on the 23rd → Risk of far-right AfD party gains impacting EUR
🎯 3. Gold (XAU/USD)
📈 Trend: Short-term correction possible, but buy-the-dip strategy remains valid
🔎 Key Factors
- Persistent geopolitical risks
- Uncertainty around Fed’s monetary policy
- Beware of short-term profit-taking while looking for dip-buying opportunities
🎯 4. Bitcoin (BTC/USD)
📉 Trend: Range-bound around $100K
🔎 Key Factors
- A push above $110K requires new bullish catalysts
- Maintaining a short-term dip-buying strategy
📌 Key Economic Events for the Week of February 17
📅 February 17-18 - RBA Policy Decision (AUD)
📅 February 19 - RBNZ Policy Decision (NZD)
📅 February 19 - South Africa January CPI (ZAR)
📅 February 23 - German General Election (EUR)
📢 Conclusion:
The market is digesting the impact of the US CPI release and US-Japan trade negotiations while continuing a risk-on trend.
FOMC Minutes and Japan’s CPI will be key to the next moves in the forex market🔥
📌 Lessons from This Week
❌ Position sizing was inadequate → Risk management must be reinforced
❌ Misjudged trend reversals → Need to stay flexible with market themes
✅ Mental discipline is key! → A well-managed trading mindset leads to long-term success
Next week, I will focus on careful entries and aim to accumulate profits consistently🔥
