Welcome to today’s entry into my Forex trading journal and blog. Today, I’m analyzing a short trade I took in the pair GBP/USD. Read on to see how it went.
This was another trade that triggered a few hours after I set my entry. I kept my eye on this the entire time and it stayed within my parameters, so I left the order out. That, coupled with the fact that my R:R was quite high made me feel comfortable about leaving it open.
It’s now after 3, I’m mostly done working for the day, probably, so I set a trailing stop and I’m letting it ride. We’ll see how it plays out and I’ll do a full analysis of this trade when it closes.
Starting on the daily chart, price had been pushing down since mid-July; though it had been moving sideways since the beginning of October. When I saw this chart, price had made a strong spike and took out the highs that were formed during the sideways move. Price pushed up to the upper band on the 4 hour chart, got close to it on the 2 hour chart, and was in overbought levels in both.
Entry – 1.236
Stop – 1.24
Target – 1.222
R:R – 3.5
Entry – 1.236
I dropped down to the 15 minute chart to look for entries. There was a bit of a bear rally that formed before I got to the chart, and when I did, price was on yet another bear rally. Price got near the highs of the first rally, but still stayed lower, so I used that as my basis to set my stop. I set my entry below the recent swing low, and my target at the area of support that was resistance throughout October. Given those levels, I had a 3.5 R:R, so I pulled the trigger. As I mentioned, price took some time, but eventually it pushed down enough to trigger me in to the trade.
Exit – 1.23033
It wasn’t extremely fast-moving, but that’s swing trading. Price continued pushing down after my entry, steadily, over almost exactly the next 24 hours. I entered the trade yesterday at 1:10pm and it hit my stop today at 1:11pm for a nice 56 pip gain.
Overall, this was almost exactly what I’m looking for when trading. The only thing I’d say that would be more ideal would be if the high I’m shorting off of was a lower high, rather than a new swing high. Either way, I liked the direction, and I liked how the indicators lined up, and I made a nice profit. Here’s to finding more opportunities like these.
Let me know what you thought about this trade in the comments. If you would have done anything different, let me know that too. Thanks for reading and stay tuned for more Forex analysis and trades.