New Week, Possible GBP/USD Short

May 26, 2008 21:25 by Jon

After a long weekend, it's back to trying to make some money in the markets.  I see a possible short in GBP/USD on the daily chart.  The last two days have been doji candlesticks near a falling trendline that is serving as resistance.  There's room below where the pair is currently trading for it to fall, so if it breaches the two-day low, I'm going to hop on board and hopefully bag some pips.  I'm going to enter two lots, but not set a profit target on either of them initially.  I'll be moving my stop loss to breakeven if the trade moves 1R in my favor.  At 2R, I'll take a profit on half of my position.  However, if price dictates that I exit early, I'll do so.  I've not been happy with my trade management and risk/reward ratio recently, feeling like I've been leaving a lot of money on the table.  So I'm experimenting with more aggressive trade management and lower risk/reward ratios.  Looking at the chart, it's quite possible that this trade could yield several multiples of R before it hits significant support.

  • Order = Sell Limit
  • Limit Price = 1.97452
  • Stop Loss = 1.98614
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