Trade Closed: 2013-03-19 02:13

As if it wasn't bad enough that I missed out on my NZD/CHF trade, I also got a black eye on my EUR/GBP setup.

Resistance-turned-support at .8680 actually held for a bit, and my trade was looking good. However, that didn't last too long, as the euro got pounded thanks to poor employment figures and weak European bond auctions. Meanwhile, the pound saw its biggest one-day gain in SEVEN months on rumors that Qatar was going to invest billions of pounds in infrastructure projects!

Needless to say, we didn't get the retracement we saw. Instead, EUR/GBP broke through the 61.8% Fib level and nearly retested the previous swing low!

Stopped out at .8640: -40 pips / -0.50%

Tough luck but truth be told, there was nothing I could do about this. After all, its not like I'm in cahoots with the Qatari royal family right?!

Anyway, time to shake off my recent struggles and get back in the game!

Trade idea: 2013-03-13 03:35

Can you spell weak sauce? I can.

P-O-U-N-D!

The pound has been the weakest link in the forex markets right now, as concerns of the United Kingdom entering yet another recession are surfacing. Yesterday, we got more data to support this theory, as manufacturing and industrial production showed declines of 1.5% and 1.2%, respectively.

This has got market playas thinking that we may see the Bank of England expand its bond purchase program at its next meeting, which signals to me that it's time to take a bearish position on the pound.

That said, I think this could be a solid opportunity to hop on the uptrend on EUR/GBP. Right now, I'm looking to buy at around .8680, which has served as a key area of interest in the past. It lines up right between the 50.0 % and 61.8% Fib. I just have to be a little patient for price to hit my desired entry point.

I'll be risking 0.50% of my account on this trade, and have placed my stop at .8640. If price hits that area, it would have broken below recent lows, which may indicate that pound weakness may be coming to an end. As for my profit target, I'll be aiming for the recent high at .8780.

Long EUR/GBP at .8680, stop loss at .8640, profit target at .8780.

We've got only second tier reports headed our way from the euro zone or the U.K. over the next couple of days, so I don't see any reason for the recent trend to change soon. Still, I gotta stay on my toes, as you never know what new developments may emerge from the European political arena.

So, who's joining me on this setup?

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