The Trading Tigers Signal Model has shown that this pair, is in an Bearish out look since 9th July. My next approach is the strong weak analysis, showing the US$ this week, in joint position with the Euro and the strongest.
The GBP is 4 strongest out of 7 therefore in a mid position. Our concept is to play US $ Strength. With patience and discipline, I have had to keep my finger off the entry trigger, to wait for various confirmations. before entry Short.
With a confluence area, the Fibonacci retracement from 15th July 2013 high to the low of 6th July 2013 , the Fib level of 0.618 is at 1.5396 , which is also the Monthly pivot point of the P line , and together with the high of 29 th December 2012 to the low of 9th March 2013, the 0.38 % level on the weekly. Further to this, 23rd July 2013, an in decision candle on the 0.618, and the bearish candle on the following day, leading to todays break of the trend line . However may take a few days for price to move down.
From the daily chart below, a break of the trend line aggressively down did go the GBP , I had taken an aggressive entry on the small wick break out of 22nd July 2013, at 1.5263, of 0.46 % of the account. The price retraced further, and then took another short at 1.5263 of 0.58% of the account , risking 1 % of the trading account.
SSD – The Slow Stochastics, is in the Overbought area, however means nothing until the cross over and fall below the 80 level. However indicators are slower than the charts price action , and that of support and resistance.
The current trades I will close at reward / risk 2/1.
Currently now Donchian Channel has been activated, and will only be triggered, when the lower channel has been hit. By which time the 4 hour would be triggered. Therefore now we will follow on the 4 hr to watch the 4 hr to be activated, where another Trade Entry would be taken.
Trade was closed last night, market moved against the trade, and hit the stops , price went beyond of 1.5400, to 1. 5436 which penetrated the already broken trend which previously acted as support, line then bounced back below the trend line now to act as resistance. Our initial trade entry was based on the broken trend line. Currently price is holding around the confluence area of 1.5367 – 1..54080. How to of improved the trade, I could of waited for 1 day for the candle to close below the trend line before entry to give the final confirmation.However the entry was a soft aggressive entry and therefore risk management was key. This is trading and proves the market can do what ever it wants, and kill any good trade set up no matter how much I analyse. Any re entry will need a clear break of that trend line with close below.
TRADE 1 – 136 PIPS ( 0.58% ACCT)
TRADE 2 – 111 PIPS ( 0.46 % ACCT)
Remember : NOT BEING IN A TRADE IS A POSITION.