Thanks to a bit of risk appetite following Janet Yellen’s speech, GBP/USD was able to break above 1.6450 and make new monthly highs.
I didn’t pass up the opportunity to finally enter a potential leg higher. After all, I have already waited until after the BOE interest rate decision, NFP report, and Yellen’s speech. That’s too long a wait for such a good setup!
This week we still have Mark Carney‘s quarterly inflation report where he’s expected to make adjustments to the BOE’s forward guidance. Analysts say that it could weigh on the pound if he signals a longer wait for a rate hike. Alternatively, he could also upgrade the bank’s growth forecasts and boost the pound higher.
I risked 0.50% of my account, entered at 1.6468 yesterday and placed a 200-pip stop (almost a full weekly ATR move away). I don’t have a profit target yet but I’ll be aiming for at least the previous highs near 1.6700. I’m planning to add another 0.50% position if Carney’s speech turn out to be pound bullish and tighten my stop if the pound starts to weaken across the board.
What do you think? Will the quarterly inflation report out to be bullish or bearish for the pound? Let me know what you think about opening up pound positions! 🙂