I can tell you I sure received an assortment of email responses from our long EUR/USD trade last night that saw the EUR/USD plunge 120 points. Losses were limited to a 40 point stop loss, but a few readers were wondering how I could be so wrong on the direction.

I understand being stopped out and totally wrong on direction can be frustrating, but allow me to share of bit of advice with you. The day I became a trader was the day I realized that there is no surefire way to determine where the market is headed, aside from being the guy who unloads $2 billion on the market. The real â�,��"ahh-haaaâ�,� hit me when I realized that you donâ�,��"�t have to know where the market is going to make money, you just have to manage every trade well.

The best traders in the world have a inclination of where the market might go.  They position themselves at prices better than the retail crowd, which is key, and then manage the trade well to grab say 50 points. If they made 50 points on that trade, they know that the next losing trade is right around the corner, because every trader has them, so they only allow a 25 point stop loss on the next trade.

We have a new focus level in EUR/USD to work towards this week. AB=CD and 1.272 Fib extension falls in at 1.2350. The problem is that there is a ton of support at or around the 1.2500 level. Take a look at point B with the triple-bottom test of 1.2500 highlighted in orange. I'm guessing it's going to be a battle getting through there.

I'm short a small USD/JPY position at 117.10 with a stop at 117.25 against the Fib resistance zone. This is a highly contra-trend trade that will probably get stopped out, but only for 15 points. If this trade works, the minimum I'm taking home is 50 points. So to me, it's worth the risk because I'm willing to manage it.

Anyway, the real trade for the week is to be short EUR/USD below 1.2500 with stops above 1.2525 targeting 1.2350 on the final piece of your position.

Todd Gordon is a Technical Currency Strategist and Fund Trader with GAIN Capital Group.

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The information and opinions in this report are for general information use only and are not intended as an offer or solicitation with respect to the purchase or sale of any currency. All opinions and information contained in this report are subject to change without notice. This report has been prepared without regard to the specific investment objectives, financial situation and needs of any particular recipient. While the information contained herein was obtained from sources believed to be reliable, author does not guarantee its accuracy or completeness, nor does author assume any liability for any direct, indirect or consequential loss that may result from the reliance by any person upon any such information or opinions.