I’m booking my profits on this one, fellas! With the BOE statement coming up, I’m not too sure if GBP/CHF can carry on with its climb for the rest of the week. As I’ve mentioned in my trade idea, I’ve been banking on the anti-Brexit sentiment to keep the pound supported in the next few days but it seems that this theme might be overshadowed by a dovish policy statement.
I made a quick review of Forex Gump’s roundup for the U.K. economy and noticed that trade activity, consumer spending, and business conditions have all worsened recently. In fact, the latest batch of PMI readings from the previous week came in much weaker than expected. This could set the stage for a downbeat central bank announcement and MPC meeting minutes, possibly even resulting to downgraded economic forecasts for their Inflation Report.
With that, I’ve decided to lock in whatever gains I had from this GBP/CHF long position. It seemed as though price was having difficulty breaking past the 1.4000 major psychological barrier anyway so I exited around that area.
For now, here’s what I’ve got:
P/L: +167 pips / +0.24%
I’m still open to taking a swing long position on this pair should the BOE sound less dovish than expected or if the SNB ramps up its intervention efforts, but I’ll wait for the potential inverse head and shoulders pattern to be completed.
Remember to never risk more than 1% of a trading account on any single trade and to adjust position sizes accordingly. Create your own ideas, don’t simply copy what I do, and make sure you’ve read our risk disclosure!
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