I’ve decided to cash in on my winnings for this one as the tide seems to be turning in favor of the Canadian dollar. Here’s what I ended up with.
Long GBP/CAD Trade
I had my one good eye on the long-term double bottom breakout, which signaled that the pair was in for plenty of upside. I was able to hop in at 1.8075, just above the neckline, and set my sights on a huge profit target near the 1.9000 handle.
However, U.K. CPI readings turned out to be disappointments, leading many to speculate that the upcoming BOE decision might be a less hawkish one. At the same time, the Loonie got a boost from positive remarks coming from both Canada and the U.S. when it came to NAFTA talks.
Because of that, I decided to jump out early and take profits at the area of interest around the 1.8400 handle. Whether I’d regret this decision later on remains to be seen, but I am still hoping to be able to catch another quick pullback on this pair if longer-term fundamentals stay unchanged.
I was feeling uneasy about holding on to this position during this week’s BOE decision anyway since these top-tier events tend to be a downer when expectations are running too high. Of course I do stand ready to jump in on another upside break as well if Carney steps up his hawkish hints.
For now, here’s what I got:
P/L: +300 pips / +0.375%
Not so bad, eh? I had a pretty wide stop on this setup since I was watching the daily chart, so my percentage gains aren’t so sizeable. I’ll probably maintain this same structure if I reenter, and I’ll keep y’all posted!
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.