Trade of the Week: short orange juice
For technical reasons, we would like to go short orange juice futures with a stop loss above the August peak at $332.70 and a downside target of around $288.
(Video Transcript)
DAX, Robusta trades panned out well
Hello and welcome to Trade of the Week on Monday, 4 September 2023.
Three weeks ago, we went long the DAX 40 contract. And, as you can see here, that trade has worked out really well so far. We went long around 15,620, and if you are still long, you can either raise your stop loss level to break even or to the last reaction low, perhaps Friday's low at 15,820.
So that would be a 200-point profit. At the moment, we are in profit by about 300 points or so. Or you can just let it run. So that trade is still ongoing and doing quite well.
And we also had Robusta coffee. We went long, Robusta coffee last week and we did so $2,4225, actually. And that trade is also working out quite well. So I thought you can also raise your stop loss level to break even. So that way you have a free trade on or you can just cash it in now with a nice profit at the moment or let it run.
Short orange juice trades against the trend for a reason
This brings me to this week's Trade of the Week, which is to go short orange juice. It's a trade against the trend, but there is a technical reason for it.
Now, you can see here we failed at the August high, just last week and we then formed a bearish engulfing pattern. And quite often when that happens, you at least get a sideways correction, but sometimes even a sharp trend reversal
And, therefore, I'd like to go short orange juice and do so with a downside target of around the August low.
So, purely for technical reasons this time around, this week's Trade of the Week is to go short orange juice, ideally around the $320 mark with a stop loss above the August high at $332.70 and a downside target around the $288 mark.
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