Paper trade: Short NZD/USD 100% @ 0.73701, stop 0.7480

In addition to my USD/CHF long, I also placed this NZD/USD short order last night. Having failed to short this earlier on a resistance test of 0.7300 using the 4 hour time frame, I'm testing out my daily method now for shorting at resistance at 0.7380. 0.7380 is an important resistance for NZD/USD because it marks the breaking point back in July 2008 when NZD/USD started a 6-month long downtrend. Although 0.7500 is definitely a much stronger and more obvious resistance level, it is a bit too obvious to wait to shorting it then. I would not short at 0.75 just because it's too obvious to be run down. Furthermore, NZD/USD has been chugging upward relentlessly. It is deep in overbought territory as shown by the RSI of Figure 1. Thus, I'm feeling confident enough in this trade to enter with a full 100% position. Entry: 0.73701 Stop: 0.7500, 0.7480 Target: 0.7000 Reward / Risk = 370.1 / 129.9 = 2.8 \< 3. So I'm moving my stop closer, right at the resistance from the starting point of the long term drop which started in July 2008. Reward / Risk = 370.1 / 109.9 = 3.4 NZD/USD took a quick dive of about 70 pips within hours of my entry. So I moved 1/2 of my stop to break-even (net +\$1.81). That tight stop was taken this evening at the open of the Pacific market, see Figure 2. I'm left with only a 1/2 position now. Once again, I'm a bit too hasten to move up my stop. Time will tell if that was a good decision.

[caption id="" align="aligncenter" width="580" caption="NZD/USD"][NZD/USD]NZD/USD[/caption] [caption id="" align="aligncenter" width="580" caption="NZD/USD, 3-hour"][NZD/USD,
3-hour]NZD/USD, 3-hour[/caption]