About Pick of the Day

Each day, I will try to find what I believe is the best looking short term trade setup for the upcoming trading day or week. If you're a forex newbie, it can be tricky in the beginning trying to figure out how to look at charts and draw lines. My goal is help you understand the psychology of price movements so you can learn to analyze your own charts and trade on your very own. I will post my ideas and/or reviews through out each session right here, on Twitter and on Facebook.

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September 2006

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Pick of the Day: GBP/USD

Posted 21:10 06 September 2006 | Comments

I couldn't resist doing another pick on the GBP/USD with such a nice technical setup. Fundamentally, we saw a strong drop in the pair due to inline results from manufacturing and industrial data from the UK, and rising inflation expectations from the US. Of course, we saw a retracement on profit taking after the move, so what's next for this volatile pair? Well, we have the Bank of England rate decision tomorrow morning at 7:00 am EST with the market forecasting no change. In the upcoming euro session, little movement is predicted - probably due to traders waiting on the sidelines until tomorrow morning. If there is a surprise change we could possibly a potential +100 pips. Until then, I'm going to stick with a short play on the pair and I'll have a long trade ready in case of a surprise raise in interest rates from the BoE...

Short GBP/USD at 1.8850, stop at 1.8875, pt1 at 1.8830, pt2 at 1.8770

Long GBP/USD at 1.8900 stop at 1.8880, pt1 at 1.8930, pt2 at 1.8960