Live Trade – GBP/USD

Filed under: Live Trades |

I currently have a live trade on the GBP/USD forex currency pair, which for those of you that still don’t know is the exchange rate between the British pound and the United States dollar. If you take a look at Figure 1, you will see the daily chart for this pair, and this will be the only chart that we will need to look at for this particular setup as all the data that we need is contained within this chart.

 

Figure 1.

Figure 1.

What you can see on this chart is that the pair is moving down nicely from left to right, and the 8-day exponential moving average is crossed well below the 21-day exponential moving average, signalling and confirming that the pair is in a very nice downtrend. In this kind of strong bear trend, we only really want to be entering the market with short trades, as anything else would be going against this strong momentum. This would be like trying to swim against the tide – it is simply much easier to swim with it.

 

There was a nice level of support/resistance forming at the bottom of this chart (marked with a horizontal green band), and it was here that a nice bearish pin bar formed. I put an order in to go short at a 50% retracement of the pin bar, with a stop loss placed just a few pips above the high of the pin bar, and a target set of two and a half times the risk. This is a nice simple setup, and one that has currently been filled and moved into a slight profit. We will see how this one progresses over the next couple of days, and hopefully, it will get us back to winning ways… Until then, have a great day’s trading!

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