GBP/USD: Riding the Uptrend – Trade Cancelled

Trade Cancelled: 2012-6-26 03:17

GBP/USD 4-Hour Chart

As I mentioned in the comments, I decided against taking this trade. The signals just didn’t line up. There were no reversal candlesticks and the rising trend line did not hold.

In addition, risk aversion was so strong that the better-than-expected retail sales report (it showed a 1.4% gain, much higher then the 1.1% initially predicted) failed to boost the pound.

Limit buy at 1.5600 cancelled: 0 pips.

Trade Idea: 2012-6-21 01:45

GBP/USD 4-Hour Chart

Although I lost on my GBP/USD trade last week, I’m still not giving up on the pair! Instead of hoping for a reversal though, I’m planning to ride the uptrend this time around.

I almost immediately fell in love with the setup when I saw it on Big Pippin’s chart art for today. GBP/USD traded past resistance at 1.5600 last week but using the Fibonacci retracement tool, we see the pair could revisit the major psychological handle soon. If that happens, I’ll be ready to go long!

Actually, I’m flexible with my entry. When I see reversal candlesticks materialize around the Fib levels and confirm my theory that price will find support at the rising trend line, I’ll pull the trigger. I think I will then put my stop at 1.5530, well below the 61.8% Fib level while aiming for the pair to tap a new high around 1.5800.

If reversal candlesticks don’t materialize though, little ol’ Huck will just stay at the side lines this week. I would take it as a sign that the pound’s rally is over. It’s unlikey especially since the currency’s fundamental landscape now is far from being PIP-turesque (Ha! Get it??).

According to Pip Diddy, the MPC minutes yesterday showed that the BOE could resort to QE very soon with more central bankers realizing the need to provide the economy with more stimulus.

But perhaps the pound will find some support if the retail sales report comes in better than expected later. I’ll see how the pair reacts to the figure and if I’m convinced that it’s enough to sustain the uptrend, I might just enter at market. I’ll be sure to let you guys know!

To recap, I plan to:

Buy GBP/USD at 1.5600, SL at 1.5530, PT at 1.5800. 1% risk. (Risk disclosure.)

Wish me luck!

XOXO,

Huck

Follow me on MeetPips.com
Follow me on Twitter
Like my page on Facebook

  • Mcaochuka

    I hope you are not really sticking with the long idea anymore!
    Good luck if and whenever you decide the pair is enormously bearish right now

    • huck

      I agree with you. I didn’t enter also since I did not see the buy signals that I wanted.

  • Pedram

    Why do I see different candles on my chart!!!
     The overall trend is the same though.

    • huck

      It’s probably due to the minute differences in our brokers’ price feeds. It’ll probably off by 2-3 pips, but should generally show the same thing.

      You can test this out by opening demos with different brokers. You’ll see that the candles are different. :)

  • Sazzad

    HI have you any calculation about ERU/USD. Its already break daily & weekly pivot this down trend will be continue.

  • antiguilty

    is that a typo?? should be 1.5600, not 1.2600??

    • huck

      Thanks for pointing that out! Edited :)