I’ve had a couple of pound setups open last week but I’ve decided to lock in some gains ahead of the weekend. As I’ve mentioned in my tweet on Friday, I didn’t want to leave any positions exposed to potential price gaps or sharp moves on profit-taking then. At the start of this week, I noticed that pound bulls are still charging so I decided to reopen my EUR/GBP short.
If you’re wondering what I’m talking about, make sure you read my initial EUR/GBP trade idea here.
I was able to open a short position on a break of the head and shoulders neckline around .7680 then I locked in a 45-pip win on Friday for a 0.12% gain on my account. Then I reopened my short position on Monday at .7600 with my stop adjusted down to .7675.
There are a bunch of PMI releases lined up from the U.K. this week and analysts are expecting to see small improvements which might be bullish for the pound. Then again, even with weaker than expected results, I’m inclined to think that the British currency might shrug off those figures again and focus on Brexit-related updates.
Another event risk I’ll be watching out for is the ECB interest rate statement, although I doubt that Draghi and his gang of policymakers would be announcing anything new this time. Still, any remarks suggesting that the ECB is no longer as dovish as they used to be might lift the shared currency.
As for my GBP/JPY trade, it turns out my decision to close ahead of the weekend was a good call, as the pair is now breaking past the ascending triangle resistance around the 162.00 levels.
I was able to chalk up a 70-pip win on this one, amounting to a meager 0.05% gain on my account. Practically breakeven but I’m just happy it wasn’t a loss!
For now, it looks like the yen is losing a lot of ground on rumors that the Japanese government is planning to delay its sales tax hike much longer. Because of that, I’m considering switching my bias and going for a long setup on this one, but I’m also open to other bearish yen setup. Got any ideas you’d like to share with me?