Trading the pound sterling has been my focus for most of last week and the early of this week when I took on more than expected GBP trades.
There’s nothing fundamental for the time being, but there’s a few trades that have happened so far. I got in on some new pairs and exited on others.
I finally exited this trade after seeing a few pull backs that doesn’t look too promising when it comes expecting a further downside. As you can see over on the hourly, the sell-off is getting weaker and weaker so I did not want to risk holding this trade through a consolidation wedge of any sort. Overall, this remains a pretty good trade netting +156 pips.
Similar idea here with the GBPUSD trade. I didn’t really like seeing this consolidation after an extensive selling period as it could be a sign of sellers drying up. I got out on the top of the range as a pre-caution in case it does break through. Not as nice as the GBPJPY trade, but managed to close it out at a +57.5 pips gain.
I did enter short on this trade just now hoping to make a range play as current candle breaks out below of the previous 4-hour inside candle. My take profit is at the bottom of the range, which works out to 40 pips. This gives me a 1R ratio. I will be posting an update on how this trade plays out.
Let’s talk a little bit of the new trades I entered. Naturally I see the pound sterling as a fundamentally weaker currency against pretty much all other pairs. Not only do we still face the progress of Brexit, here is the month over month inflation changes.
Two months of slowing inflation is not helping the cause. While inflation rate is still sitting above the BOE’s target, the pound sterling has not been performing well and I expect no changes ahead. Moving on below, here are two new trades I entered since yesterday.
As this trade breaks above my daily level land held supported, that’s where I entered. The potential daily level met with minimal resistance and so I consider the support test a relatively good point to enter.
This trade still has not yet paid off, but I took it seeing that it could make a good swing trading opportunity. Unfortunately, I was a bit late to the scene and didn’t get in at any of the optimal entry zones highlighted in the attached chart grab. Nevertheless, yesterday’s green bar seems to be held off with a longer upper wick indicating it failed to close as high as it traded. Today’s bearish bar should be a good indication for the week ahead as, usually, the market open bar will be a bit weird. Aside from that, I’m not too concerned about holding this trade as long as the momentum is there since it is racking up a positive swap charge.