Pick of the Day: GBP/USD – Close Open Orders

Close Open Orders: 2008-01-09 11:28

As I commented below, Cable sold off as soon as the European trading session opened. The rally to the top of the consolidation range didn’t materialize; instead the pair broke below previous lows around 1.9660 all the way down to its current trading area around 1.9550.

Close open orders to short GBP/USD at 1.9825

So, we were right in the direction, but just a bit too conservative on our entry.

We have UK and ECB interest rate statements tomorrow, so I’ll have a trade idea tonight for how Asia and Europe may play the currencies before the statement. Stay tuned!

Trade Idea: 2008-01-09 00:09

PoD Chart

We have a light economic calendar for today’s trading session, and with the Bank of England’s interest rate decision coming up in a couple of days, today’s trading session looks like a good opportunity for a range play.

As we can see on the chart, Cable has been consolidating this week for the reasons mentioned above and will probably continue until Thursday’s rate decision. I like a short at the 38% Fibonacci area as we saw resistance and reversal a day earlier.

A short also plays into the sentiment that Cable’s rally has been a bit overdone and we are in a corrective phase at the moment. So, we will sell short and possibly convert this trade from a short term trade to a longer one if the downtrend resumes.

Short GBP/USD at 1.9825, stop at 1.9880, pt1 at 1.9760, pt2 at 1.7655

Remember never to risk more than 1% of your account on any single trade. Adjust position sizes accordingly.

Good luck!

8 comments

  1. hypnos63

    hi pip crawler,i am a little confused here. you posted this pick 0009am 09/jan 2008 right? but by the metatrader 4 4hr chart, GBP/USD hit 1.9825 at 2008.01.08 0800 (MT4 time),that would be 0700 GMT or 0200am EST jan 8 which was already past by the time you made your post. are you saying that GBP/USD will reach 1.9825 again and we should then enter the trade as you suggest. please reply soon. hypnos63@yahoo.com

    Reply
  2. PipcrawlerPipcrawler

    Yes, if the pair rallied back up to 1.9825, I would have shorted at the top of the consolidation range… but it looks like Cable just sold off right from the beginning of the European trading session….No trade.

    Reply
  3. hypnos63

    hi pip crawler,i am a little confused here. you posted this pick 0009am 09/jan 2008 right? but by the metatrader 4 4hr chart, GBP/USD hit 1.9825 at 2008.01.08 0800 (MT4 time),that would be 0700 GMT or 0200am EST jan 8 which was already past by the time you made your post. are you saying that GBP/USD will reach 1.9825 again and we should then enter the trade as you suggest. please reply soon. hypnos63@yahoo.com

    Reply
  4. PipcrawlerPipcrawler

    Yes, if the pair rallied back up to 1.9825, I would have shorted at the top of the consolidation range… but it looks like Cable just sold off right from the beginning of the European trading session….No trade.

    Reply

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