USDSGD Call Option Knocked In

Our Call Option was knocked out at 1.5250 for a 2.1% profit on the option

You will recall on February 18th, we took profit on our spot trade USDSGD at 1.5270, locking in profits of 320bps.

Though we felt that the daily momentum was weaning, however, the weekly chart indicates still more upside, so we kept the call option and placed a take profit level or stop/loss level at 1.5250. Why, it is call risk management and also strategizing to lock in profits; if USDSGD does truly weakens pass 1.5250, then it would trigger our stop/loss and we would have locked in our profits from 1.4930 to 1.5250. If USDSGD continues to power upwards towards 1.55, then, we can continue to ride the wave as we have time on the option before maturity. In either case, it is prudent risk management.

Guess what, on February 19th, our level was hit and in fact it went to a low of 1.5218.

We locked in a 2.1% profit or US$21,000 per every US$1Million.

We also mentioned that we were interested in the AUD, however, with the negative news on Friday about the potential demise of Bank of American and Citigroup; everyone began selling US Dollars, against most G7 currencies, it moved by at least one big figure if not two big figures in some cases.

So for now, we will study the markets again and seek out opportunities soon.

To sum up; we did three USDSGD trades this month and achieved net trading profits of 4.87%.