Cross-Eyeing: EUR/GBP – Trade Closed

Trade Closed: 2008-08-13 10:05

Looks like UK data came out weak once again, pushing EUR/GBP higher during the European trading session to trigger my short trade at .7900. Unfortunately, there were not enough sellers waiting at the falling trendline to slow down the rally or stop it as the pair hit my stop at .7950.

Total: -50 pips/ -1.0% loss

It looks like the pair will continue higher on Sterling weakness, but I look to .8000 as a possible area of resistance as the pair has yet to stay above that level for the past 3 months. Bummer on today’s loss, but you gotta take the bad with the good, right? Have a great day!

Trade Idea: 2008-08-12 23:19

crosseyed chart

EUR/GBP is making moves back higher, taking the pair towards a falling trendline on the 4hour chart. Could sellers be waiting to take the pair lower once again?

We have a simple chart pattern forming as the pair rises towards the trendline connecting the lower highs. Stochastics are indicating the short term rally may be losing steam, giving market players a chance to make a swing trade back into the downtrend.

I look to jump in short, but first it’s good to take note that we do have event risk coming up during the European trading session with the UK Claimant Count Change, Average Earnings Index and BOE Inflation Report. Out of the Eurozone we have Industrial Production data. These events may give the market enough volatility to take the pair up to the trendline. I look to:

Short EUR/GBP at .7900, stop at .7950, pt1 at .7850, pt2 at .7800

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

Stay tuned and good luck!

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