Live Trade Order – GBP/USD

Filed under: Live Trades |

 

I have a live trade order on the GBP/USD forex currency pair today – and I would like to talk you through the ins and outs of this setup right now.

 

Figure 1.

Figure 1.

If you take a look at Figure 1, you will see the daily chart for the GBP/USD pair. What you can see here is that an inside bar setup has occurred (see highlighted section), so I have put an order in to go long at the break of the high of the mother candle of this inside bar, with a stop loss placed just a few pips below the low of the same mother candle, and a target set of two times the risk (which also coincides with the next logical support/resistance level).

 

Now, we don’t always place orders when an inside bar setup occurs. However, over the past couple of weeks, this market has been very bullish and the 8-day exponential moving average has crossed above the 21-day exponential moving average, confirming this bullish momentum – so we only really want to enter this market on the long side at present. The inside bar tells us that the market is consolidating and taking a breather, and if the mother candle is broken to the upside, then this is a good place to enter the market, particularly as it is above the support/resistance level marked in on the chart with a horizontal red line. Of course, a break above the mother candle could also turn out to be a false move – and these price action signals are not certainties by any means, but simply give us a market edge to exploit over the long term. However, if price broke above the mother candle of the inside bar, I would be happy to be long on this market at present, and I would manage the trade depending on what price action tells us at the end of each trading day.

2 Responses to Live Trade Order – GBP/USD

  1. Hi

    Regarding your live trade example GBP/USD what time frame are you using with the 8 & 21 exp mov avge?

    Chris
    June 14, 2013 at 1:12 pm
    Reply

  2. An interesting trade but i woud havev prefered to have gone long when the moving avaerages had crossed,and started to move apart,and my profit target would have been the the red support line,where the trade has currently stalled,also the two moving averages had moved across the body of a previous candle,quite often sign of a reverse of trend,albeit below the red horizontal support line.

    Paul
    June 14, 2013 at 1:17 pm
    Reply

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