Live Trade – GBP/USD

Filed under: Live Trades |

Before I begin today, I should tell you that the live trade that I outlined yesterday on the USD/CHF pair came off very nicely for a 3.13% gain on the bank (or a 2% gain on a theoretical bank of 10,000 GBP). You can see this as always on my published account at:

 

http://www.myfxbook.com/members/jjrgaskell/daily-trade/357261

 

I also currently have a live trade on the GBP/USD pair, which is a setup that I would like to tell you about right now.

 

Figure 1.

To begin with, take a look at Figure 1. This is the daily chart for the GBP/USD pair, and it is the only chart that will be required for this particular setup. As you can see, this pair is particularly bullish at the moment, with the 8-day exponential moving average crossed firmly above the 21-day exponential moving average. I had also marked in a significant area of support/resistance at the top of this chart. Now, if price had bounced off of this level, I would not have entered a short trade because the pair is currently so bullish and I do not like to go against such strong momentum. So, what I was looking out for here was a breakout above this level of resistance.

 

Therefore, when price broke above this level, and crucially, closed above this level, I put an order in to go long at a 50% retracement of the bullish candle, with a stop loss placed just a few pips below the low of the bullish candle, and a target of two times my risk. This order has now been filled, and we are now in this trade. Hopefully, this bullish momentum will continue for a while longer, and our target will soon be met. Well, that’s it for today, and I’ll be back tomorrow with yet more forex price action trade examples.

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