Close Trade: 2008-08-20 16:43
Close open position at market (1.8618)
Total: +32 pips/ +0.21%
Trade Update: 2008-08-20 10:57
Cable dropped as soon as the European markets began to open this morning, taking the pair down beyond 1.8600. The pair quickly found support at yesterday’s low around 1.8550 and rallied into the morning US session. We’re now seeing the pair drop once again as the Greenback rallies on a surprise rise in crude inventories. I am going to:
Trade Idea: 2008-08-19 19:28
I’ve got the one hour chart up and we can see a few classical chart patterns forming. First, there is a potential descending triangle pattern forming, and in a downtrend, this chart pattern indicates we may see a continuation if support is broken. And second, there is hidden bearish divergence as we see lower highs in price and higher highs on the stochastics (which happen to be in overbought territory as well). So, the technicals look good, how about the fundies?
The sentiment has been that the UK is starting to feel the credit crunch and slowing growth. Bank of England policy maker Tim Besley said inflation may fall by the end of next year, fueling the case for interest-rate cuts. The BOE Meeting Minutes is in the line up for release today, and if it shows there were more members who voted for a rate cut, we could see further selling in the Sterling. Of course, whether we see hawkish or dovish rhetoric accompany the vote makes a big difference as well.
So, with that in mind, I plan to short the pair with a wide stop to weather any potential volatility today’s economic events may bring. I will: