Trade Review: EUR/GBP Channel Retracement

A little bit of patience does pay off as this allowed me to exit my EUR/GBP short with a tiny win ahead of this week’s U.K. event risks. If you’re wondering what I’m talking about, don’t forget to review my initial trade setup first.

Short EUR/GBP Setup

The pair already broke past that descending channel on the 1-hour time frame that I was watching but I figured it could still bounce off the longer-term Fib levels and broken channel support. Because of that, I sat on my hands for a while and decided to wait for a better price to close.

EUR/GBP 4-hour Forex Chart

EUR/GBP 4-hour Forex Chart

I was able to lock in a meager 10 pips on this short play for a teensy 0.005% gain on my account. I know, I know… It’s not much but I’m happy with how I’ve managed my risk on this trade given all the event risks last week.

Still, I can’t help but wish that I was able to lock in more pips at the .8335 area just before the ECB made its policy statement. You see, I was hoping that this announcement would draw more euro bears to the game but Governor Draghi and his fellow policymakers just weren’t feeling all that dovish then.

I’ve decided to exit this trade now that my main argument for a selloff was invalidated and it will be the BOE’s turn to shake things up this week. By the looks of it, those U.K. events might reflect more of the post-Brexit weakness and could result to a downbeat BOE decision so I’m jumping ship now.

As always, don’t risk more than 1% of your account on a single trade and make sure you read our risk disclosure if you’re thinking of taking the same setups.

Q2 2016 Trading Performance Review
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