Pick of the Day: GBP/USD

It was a nice little surprise from the Bank of England this morning – a quarter point raise to 4.75%! Wish they told me about that one, wouldn’t that be nice? =) Well, as we can see the pair is back into consolidation mode as traders await that monthly crazy US report called Non-Farm Payroll! As usual, I suggest to those faint of heart to skip this one…we’ve made a few pips this week – why risk it? But for those who do not fear the market like me, it’s on like Donkey Kong!

The market predicts the NFP to come out at around 150K, but the market seems to be way off in its predicting power during the last few reports. The consensus on tomorrow’s report has been all over the place too, so we may see a lot volatility as traders don’t know what to expect. Again, we will have a long and short order based on pivot points with very tight stops. I suggest going with smaller lot sizes on this one to lower your risk. Also, remove an entry order if it is around 100 pips away from the market price right before the NFP release. Good luck and good trading!

Long GBP/USD at 1.8950, stop at 1.8930, pt1 at 1.8990, pt2 at 1.9040

Short GBP/USD at 1.8780, stop at 1.8800, pt1 at 1.8750, pt2 at 1.8700

Please be cautious for whipsaws around the interest statement. Good luck and good trading!