Live Trade – GBP/USD (Result)

Filed under: Live Trades |

Well, the live trade that was much discussed on the GBP/USD pair has finally been closed, and the news is not good I’m afraid – taking a 1% loss on the bank. Let’ recap on this one, and try to figure out where we might have gone wrong.

 

Figure 1.

Figure 1.

To begin with, take a look at Figure 1. We had gone short at the low of the bearish pin bar (the fifth candle from the left), with a stop loss placed just a few pips above the high of the pin bar, and a target of two times the risk. Two inside bars followed this candle, which had formed at a really significant area of support/resistance, so the order was left in a subsequently filled. It then moved into a slight profit, before reversing quickly and hitting the stop loss – forming an outside bar in the process.

 

What this outside bar now tells us is that the market is very much undecided. Looking back on the trade, if we had been a little braver, we could have entered the market at a 50% retracement of the pin bar, with the same stop loss, and a much bigger target. If we had done this, we would have moved into profits of around 1.5 times the risk – and at this stage, we might well have moved the stop to breakeven to protect those profits. If that had been the case, then we would have escaped from this trade at breakeven. However, as it is, it is a loss, and we must take that as a cost of doing business. Well, that’s all from me today, and I’ll be back with more tomorrow… Until then, have a really great day trading; and may the charts be with you!

Leave a Reply

Your email address will not be published. Required fields are marked *

You may use these HTML tags and attributes: <a href="" title=""> <abbr title=""> <acronym title=""> <b> <blockquote cite=""> <cite> <code> <del datetime=""> <em> <i> <q cite=""> <strike> <strong>