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With the Bank of England set to give their latest monetary policy statement, I decided to close my open short position and orders on EUR/GBP. Here’s a quick review.

Downside Breakout or Fakeout on EUR/GBP?

EUR/GBP 1-Hour Forex Chart
EUR/GBP 1-Hour Forex Chart

At the beginning of the month, I decided to scale into a short position in EUR/GBP after a consolidation break to play my fundamental bias favoring Sterling over the euro. I started with a nibbler at market (0.8950) with 0.33% risk and put up additional short orders 0.9025 and 0.9095.  Unfortunately, I was only able to get one position in as the pair steadily moved lower for over a week on political developments that lowered the odds of a no-deal Brexit.

I’ve gotten a nice return-on-risk so far, but with the Bank of England set to release their latest monetary policy decision in a couple of days, I decided to take profit with price stalling around a minor psychological level. I’m leading a little bit towards a bearish Sterling move this week as negative business sentiment (UK Manufacturing PMI at seven-year low, U.K. service sector growth slows in August) and Brexit fears will likely keep the BOE dovish for now. So with that, I closed the open position manually at 0.8857 and my addition open short orders above the market to lock in a profit:

Total: +93 pips / +0.13% gain on 0.33% risk taken

We’ll see in a couple of days if this was the right adjustment, but if it wasn’t, I can still re-enter the position IF the BOE continues to show optimism on the global economy and/or they still think a no-deal Brexit will be less severe than first thought.

What do you guys think? Should I have just rolled down my stop or was taking off all risk the way you would go? Let me know in the comments section below!

This content is strictly for informational purposes only and does not constitute as investment advice. Trading any financial market involves risk. Please read our Risk Disclosure to make sure you understand the risks involved.