Cross-Eyeing: GBPJPY – Close Open Orders

Close Open Orders: 2010-01-21 21:03

PoD Chart

The GBPJPY pair broke down from the symmetrical triangle formation yesterday and plummeted to the 145.50 area. Before doing so, the pair climbed to retest the top of the triangle but, unfortunately, it missed my entry order by a few pips.

Argh! That would’ve been a nice, quick, and very profitable trade. Apparently, UK’s public sector net borrowing report highlighted the nation’s weak fiscal situation. Their public sector net borrowing was at 15.7 billion GBP in December, bringing the UK’s total borrowing for 2009 to 142.6 billion GBP – its highest level since 1946! Furthermore, risk aversion was in full force yesterday, which helped the USD and JPY post decent gains across the board.

Trade Idea: 2010-01-20 22:01

PoD Chart

Hey everyone! Well, I’ve been scanning the yen crosses and came across the GBPJPY’s 4-hour chart. Good God… I spotted a humongous symmetrical triangle formation! Finally, here’s a chance for me to pocket them pips!

The pair is currently climbing towards the top of the triangle, probably to retest the resistance around 149.00 to 149.20. I’m hoping to short at the top of the triangle and take profits off at the bottom of the symmetric triangle. I also set another profit target at 146.00, which seems to be next support level in sight, in case the pair goes for a breakout to the downside. I’ll place my stop a few pips above the previous week high, just above the psychological 150.00 handle.

Looking at the BabyPips.com’s economic calendar, there doesn’t seem to be much reports that will cause a ruckus in the markets. The CBI industrial orders expectations is on deck but is expected once again to post a decline in the index, with a score of -39. If the reading comes in worse than expected, it could actually spur some pound selling as it would indicate that industrial orders are still unstable.

Furthermore, I’m keeping my eye out for any more news out of China. The markets reacted sharply to news that the Chinese government would cut back on its lending in order to prevent growth. We saw risk aversion take over once this news hit the market, spurring the dollar and yen to big gains. If we hear more rumblings out of China, we may just see this market move continue today.

So here’s what I will do:

Short GBPJPY at 149.20, stop at 150.10, pt1 at 148.00, pt2 at 146.00

Remember to never risk more than 1% of a trading account on any single trade. Adjust position sizes accordingly.

  • matt6g72

    I too have been watching for a break in the triangle the past couple days on the GBPJPY H4 chart. I actually went long yesterday at 148.20 with a take of 148.92, which ended up with a 72 pip gain for me as it hit just above that at 148.93 and then started dropping again. I am tempted to go short today but the H4 and the D1 trends are still on the up and up which makes me want to wait for another attractive candle or so before I jump in (I’m still a newbie so I am very conservative!). I see that your entry point at 149.20 was never hit, did you still go short and what was your entry point?

  • matt6g72

    Well, I decided to get in late when I saw the ridiculously long bearish candle… Got in at 146.77 and closed at 146.17. Not bad…

  • matt6g72

    I too have been watching for a break in the triangle the past couple days on the GBPJPY H4 chart. I actually went long yesterday at 148.20 with a take of 148.92, which ended up with a 72 pip gain for me as it hit just above that at 148.93 and then started dropping again. I am tempted to go short today but the H4 and the D1 trends are still on the up and up which makes me want to wait for another attractive candle or so before I jump in (I’m still a newbie so I am very conservative!). I see that your entry point at 149.20 was never hit, did you still go short and what was your entry point?

  • matt6g72

    Well, I decided to get in late when I saw the ridiculously long bearish candle… Got in at 146.77 and closed at 146.17. Not bad…

  • Cyclopip

    Sadly, I was unable to enter the trade. Like you said, the bearish candle was “ridiculously long”! Maybe next time I guess! :)

  • willariza

    Hello CC-Y!I just became a member and the reason I did it’s because I wanted to say thanks to you and all the others “peerpips”for providing an excellent service ,not “BS”and all for free.Keep up the good work. Many of us aren’t just going to be thankful but richer too!

  • Cyclopip

    Sadly, I was unable to enter the trade. Like you said, the bearish candle was “ridiculously long”! Maybe next time I guess! :)

  • willariza

    Hello CC-Y!I just became a member and the reason I did it’s because I wanted to say thanks to you and all the others “peerpips”for providing an excellent service ,not “BS”and all for free.Keep up the good work. Many of us aren’t just going to be thankful but richer too!

  • quantisan

    Got in above 146, moved stops to breakeven, then got swung out on a huge retracement before the big dive. oh well.

  • quantisan

    Got in above 146, moved stops to breakeven, then got swung out on a huge retracement before the big dive. oh well.