EUR/GBP Short Trade Review

I caught a lucky break with my trade thanks to the positive U.K. retail sales data!  Before the weekend hit, I closed my trade to avoid weekend risk and lock in some profit!

Click here to read the original short trade idea on EUR/GBP!

EUR/GBP 1 hour forex chart review

EUR/GBP 1 hour forex chart review

Not much movement for most of the week after my orders to short EUR/GBP at .8320 were triggered.  The pair danced around my entry level until we got a pretty big surprise from the U.K. retail sales data today; the headline m/m number came in at +2.6% vs. the forecast of +0.3%–whoa!  It’s another indication of the crazy economic strength the U.K. is experiencing at the moment, persuading traders to load up on more British pounds.

The initial drop was about 60 pips on the event, with the pair hitting lows around .8235–a few pips from my profit target.  Since I didn’t get a strong break of my profit target and with the weekend approaching, I decided to close my trade to lock in profits and avoid weekend risk manually at .8244.

Total: +76 pips/ 0.91% gain

In hindsight, I could have done two things differently: 1. I should have seen the setup sooner and set orders at the top WATR level to improve my entry.  2. Ahead of the U.K. retail sales event, trail my stop and set another sell stop order below market in case the data/reaction did go my way.  I knew this was an event that usually sparks big volatility, so it was a missed opportunity to increase my max profitability on this trade.  It’s the little details that can make a big difference in your end results.

Overall, this was a textbook trend retracement play that was a winner, but could have done better with my entry and trade management had I thought a bit more ahead.

That’s it for me this week.  Thanks for checking out our blogs…have a great weekend!

  • Josef Auzinger

    Hi, I´ve also traded the Retail-Sales-News , but with most of the Pound-Side-Pairs:
    GBP/AUD; GBP/NZD; GBP/JPY,GBP/CHF and GBP/CAD.
    Since these pairs are my main Trading-Pairs I pay very close attention to the British Economy,and have an Abo of various online-newspapers:
    Therfore I expected the numbers to exceed expectations and entered with confidence 30 minutes before the news, closing all trades 30 minutes thereafter: SL was in all trades 25 pips away, since that pairs usually don´t spike before announcements: Alltogether I collected 805 pips !!
    I know this sounds unbelieveable but you can check the numbers, it took me by surprise too, since I didn´t expect more than 250 at the most.
    Although I like to trade the pound a lot, I don´t trade GBP/USD and EUR/GBP, the first one due to spikes most of the time and Euro-Cable has little volatility.
    Kind regards
    parsifal

    • cyclopip

      Congrats on your big pips Josef! Yeah, I like EUR/GBP because the volatility isn’t as erratic as other Sterling pairs… To each their own, right?

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