Jump to content

GBPUSD retrace trade


Recommended Posts

Unlike other major USD pairs GBPUSD has already broken out but is now either in a Flag consolidation or a deeper retrace to retest the breakout levels.  Perhaps election uncertainty is in play and we will get a resolution (to many things I hope) on Dec 12.  

GBPUSD-Daily_231119.thumb.png.90ccb67b3d60baa587fcb2da5260935b.png

 

  • Like 1
Link to comment

@Mercury & @dmedin- Thanks for sparking this chat back up again. I feel like with everything going on with Brexit (focusing on EURGBP) and trade war we sometimes forget about Cable movement. DailyFX have wrote their thoughts on cable. Something you might find interesting, let me know :) 

image.png

 

GBP/USD: Overtaking This Price Could be a Game Changer- British Pound to USD Outlook

  • Like 1
  • Thanks 1
Link to comment

I remember being told in school that there would never be a radical government in Britain because of the capital flight that would result.  That was back in 1998 or 1999 I think.  It's a bit strange how, 20 years later, the Labour party is putting forward those views that I had in school. 

For me this reinforces the idea of cyclicality or the recurrence of things that happened in the past ... very fascinating stuff.

I'm still long on the pound though.

Edited by dmedin
Link to comment

Thanks for that @CharlotteIG, my analysis is similar in that I have a turn and breakout on GBPUSD and current consolidation, probably in a Flag, which suggests a continued rally on breakout.  I believe this is overall a counter trend rally and the long term trend remains bearish.  Naturally the UK election, Brexit new referendum or not, Marxist based government or not, Scot,and indyref2 or not is cause for concern but I imagine USD weakness might supersede this to some extent.  My EURGBP analysis is indicating a period of EUR dominance to come soon, which may also be attributable to the UK political situation, at least short to medium term.  therefore I prefer to trade EURUSD rather than GBPUSD, although I did trade the initial breakout but have cashed for profits.

  • Like 1
Link to comment
9 minutes ago, Mercury said:

Thanks for that @CharlotteIG, my analysis is similar in that I have a turn and breakout on GBPUSD and current consolidation, probably in a Flag, which suggests a continued rally on breakout.  I believe this is overall a counter trend rally and the long term trend remains bearish.  Naturally the UK election, Brexit new referendum or not, Marxist based government or not, Scot,and indyref2 or not is cause for concern but I imagine USD weakness might supersede this to some extent.  My EURGBP analysis is indicating a period of EUR dominance to come soon, which may also be attributable to the UK political situation, at least short to medium term.  therefore I prefer to trade EURUSD rather than GBPUSD, although I did trade the initial breakout but have cashed for profits.

I see what you mean and appreciate you sharing your trades. 

17 minutes ago, Mercury said:

I did trade the initial breakout but have cashed for profits.

^ 👍 Glad to hear! :) ^

We have news for each currency pair but not relevant to each other which makes deciding on a direction hard (if you're not using technical analysis). 

I wonder if anyone is going to be getting involved with the cable trade during brexit and trade war announcements and if they are how are they deciding which way to go.  

Link to comment

@Mercury

I had been looking at hourly charts, against my own resolution not to, and the price decline looked drastic on that time scale for GBP.  But on a daily chart it looks far more reasonable.  I still kind of wish I wasn't sitting on a long though.  :D

 

Edited by dmedin
Link to comment
1 hour ago, dmedin said:

I still kind of wish I wasn't sitting on a long though.

Depends on where you entered.  If you entered Long below the weekly channel line, ideally on the first retrace (12200-12400) then holding stop protected at BE is the right strategy for me.  If you entered above the current price, well I would already be out but we may be seeing an FX turn this morning.  My method rules enforce taking losses quickly on a reversal vs my route map and seeking a reentry rather than holding a deeper drawdown in the hope it turns eventually.  Lose small win big.

Regarding 1H vs Daily, I have found you need to look at both but best to ignore 1H sudden candle moves and focus on the trend as it is reflected on the Daily.  This is for longer term trading, obviously shorter term traders may be all over 1H candles. 

  • Like 1
Link to comment
On 01/10/2018 at 10:38, Mercury said:

Thanks for the comments @elle  I am not sure if your chart is supporting my assessment or suggesting a bounce off your hashed line is showing a Bearish move.  It could certainly be the case that GBP (and EUR) has put in a more shallow retrace and is now on it's way into that LT motive Bear move I was talking about.  A break of the recent lows would confirm this for me.  At present I still favour a higher retrace for both EUR and GBP but let' see...  Right now we are seeing some buying pressure on both GBP and EUR but I am not sure yet if the Wave B is done.  Got to be patient as these moves develop and wait for the trade triggers...

Very interesting and long term chart analysts Mercury. Why is it that we think that charts follow these types of patterns? Would It be right that traders have the maps "CA" and we all tend to follow? Please inlighten me your thoughts? Good work on the history plotting.   

Link to comment
On 27/11/2019 at 23:44, Trevbeats said:

Very interesting and long term chart analysts Mercury. Why is it that we think that charts follow these types of patterns? Would It be right that traders have the maps "CA" and we all tend to follow? Please inlighten me your thoughts? Good work on the history plotting. 

Not sure I fully understand your question @Trevbeats so if I have got the wrong end of the stick please let me know.  In terms of chartist patterns, this is well documented charting techniques (e.g. consolidations, retraces, Head & Shoulders, Double top/bottoms etc.).  In terms of other technical analysis that I overlay onto basic charting techniques (e.g. trend lines, Elliot Wave Theory -EWT- etc) that is partly a visualisation technique and, in the case of EWT and charting techniques, a means to map market participants sentiment as it expresses human nature (Fear and Greed).  People who use such techniques believe that while history may not actually repeat itself the circumstances impacting decision making do and human nature is largely unchanged over time.  Therefore market participants (people, even those who program the algos) react in similar ways to similar circumstances through the lens of the Fear/Greed seesaw, which itself is a form of fight or flight.  One reasons large financial institutions (and some smaller players too) attempt to deploy purely algorithmic trading mechanisms is to avoid this fight or flight emotional overlay.  Inr eality though the programmers are human and constantly adjusting the algo parameters and we are not talking about machines or AI making up their own mind here as Algos are not AI and in fact humans, some surmise, are also algorithmic machines, just biological ones.  This is at the heart of studies like Kahneman's Thinking Fast, Thinking Slow.

I cannot speak for the markets as a whole, except to say that there are many methods being deployed so I don't buy into the self fulfilling prophesy argument, at least not as a general rule.  At best I think all macro analysts and long term position takers have a road map in the sense that they have an entry and exit sketched out but not all will have it on a chart as I do.

Link to comment
On 30/11/2019 at 11:11, Mercury said:

Not sure I fully understand your question @Trevbeats so if I have got the wrong end of the stick please let me know.  In terms of chartist patterns, this is well documented charting techniques (e.g. consolidations, retraces, Head & Shoulders, Double top/bottoms etc.).  In terms of other technical analysis that I overlay onto basic charting techniques (e.g. trend lines, Elliot Wave Theory -EWT- etc) that is partly a visualisation technique and, in the case of EWT and charting techniques, a means to map market participants sentiment as it expresses human nature (Fear and Greed).  People who use such techniques believe that while history may not actually repeat itself the circumstances impacting decision making do and human nature is largely unchanged over time.  Therefore market participants (people, even those who program the algos) react in similar ways to similar circumstances through the lens of the Fear/Greed seesaw, which itself is a form of fight or flight.  One reasons large financial institutions (and some smaller players too) attempt to deploy purely algorithmic trading mechanisms is to avoid this fight or flight emotional overlay.  Inr eality though the programmers are human and constantly adjusting the algo parameters and we are not talking about machines or AI making up their own mind here as Algos are not AI and in fact humans, some surmise, are also algorithmic machines, just biological ones.  This is at the heart of studies like Kahneman's Thinking Fast, Thinking Slow.

I cannot speak for the markets as a whole, except to say that there are many methods being deployed so I don't buy into the self fulfilling prophesy argument, at least not as a general rule.  At best I think all macro analysts and long term position takers have a road map in the sense that they have an entry and exit sketched out but not all will have it on a chart as I do.

 

Link to comment

Regarding $£ pair and direction over near and medium term, I concur with your position that £sterling has bottomed and has only one way to go : sideways (only joking). The £ has been historically low  since 2016 and has reached its nadir, it is fair to suggest. Brexit bashing has done its worst, though we may not have seen the last of it and the future relationship with Europe will not be as smooth and easy a negotiation as some would wish. Sterling is priced as cheaply as is reasonable atm though others may suggest undervalued as compared to all other currencies. 

The election may not be as decisive as the polls suggest. Infact, BloJo may win but with the slenderest of majorities. He is gaffe prone and entirely self serving so the majority may not last long. However, the economy will continue to trundle along, doing well enough and out-performing many other indices.  It may well continue to do so.

Regarding possible market readjustments, we are due one, dare I say overdue. Sterling is a reliable currency. In a down turn it would do  well. Also, in order to pay for the inordinately vast spending plans interest rates may need to rise, by a point or two probably. 

In short, I agree, a long position on Sterling is a viable strategy all the way past 1:50 and beyond, same regarding euro position 1.17 will quickly become 1.30 regardless of Brexit and future relationships.

  • Like 1
Link to comment

I lucked out in the GBPUSD trade.  I was $3670 in the red short when it opened in the AM.  It immediately dropped in price, allowing me to get out without a scratch.  I unfortunately on Monday I got slammed and am $14K in the hole and held prisoner by AUDUSD, NZDUSD and AUDJPY.  I traded too large, without stops and too many pairs.  Will never repeat folly again.

Link to comment

GBPUSD is testing the upper consolidation Flag line and approaching a key resistance zone (13,000).  If we see a strong breakout here then the next phase rally will be underway.  EURUSD is also approaching a key resistance zone and AUDUSD continued its rally phase overnight.

GBPUSD-Daily_031219.thumb.png.c1fba201de2375dccb685445e7ae7733.png

  • Like 1
Link to comment

Nice breakout this morning, still to be confirmed with a close above but very encouraging.  I expect to see a similar breakout on EURUSD and USDJPY moved lower overnight (still have a recent low to eclipse just below).  Stage seems set for the USD bear to get going...

GBPUSD-Daily_041219.thumb.png.0ffb323b751bfd0f77176e0fb8c29c3f.pngGBPUSD-1-hour_041219.thumb.png.2d0583f0868e1bdf5d38b28586f78e3b.png

Link to comment

GBPUSD looks to have put in a next phase breakout, or at least is in the process of.  The uncertainty surrounding next Thursday has to be considered in terms of potential short term whipsaw and spikes.  Outwith that I would be expecting perhaps a USD led retrace on GBPUSD for a retest of the $1.30 level before the next phase rally gets going, which may have to wait until the election result of some impetus around and about the election.  My feeling is that if we get a clear majority result (which can only be a Tory one it seems) then uncertainty is lifted, perhaps also relief that a Marxist orientated government has been avoided, and GBP rallies on clarity alone, plus ongoing USD weakness.  However if we see anything else then the reverse will be the result.

GBPUSD-Weekly_071219.thumb.png.e87aa54d819a98c32a5332c906a81168.pngGBPUSD-1-hour_071219.thumb.png.1492b1fbfe3039937ed7e4294f2ed81e.png 

Link to comment
1 hour ago, dmedin said:

Gap filled ... maybe further to fall?  Just goes to show how untradable these things really are.

Depends on how you visualise it and spot turns.  I was looking for a 3-4 and maybe a retest of the Flag breakout however when the election result caused a large gap (only on the 1H) and the market stalled the day after, with a likely USD relief rally in play I went Short tactically to the Gap close you mentioned and cashed.  Now I am looking to see if we get a wave 4 turn here or a retest of the Flag breakout.   I favour the former scenario as it fits my longer term view.  So for now, unless and until price action provided an alternative, I see GBPUSD turning into a rally to complete the larger wave 1 (blue), which should complete at twice the Flag median point (not withstanding spikes) so that's $1.38-1.40 as a target.  After than we should see a retrace wave 2 that should, if everything has progressed according to the scenario, react back to the Fib 50% and a retest of the Flag support zone.  For this to happen though I would expect a general USD turn down, although there is nothing to stop GBP diverging as it has done in the past.

GBPUSD-Daily_171219.thumb.png.a9031b8903c5ace25b4d848d57c1d788.png

  • Like 1
Link to comment

GBP collapsing - fundamental situation identical to election night.  Why are retail traders even allowed to bet on such heavily manipulated/rigged markets?  Can anyone show me any kind of TA that actually works in forex?

Edited by dmedin
Link to comment

Create an account or sign in to comment

You need to be a member in order to leave a comment

Create an account

Sign up for a new account in our community. It's easy!

Register a new account

Sign in

Already have an account? Sign in here.

Sign In Now

  • image.png

  • Posts

    • MSTR Elliott Wave Analysis Trading Lounge Daily Chart, MicroStrategy Inc.,(MSTR) Daily Chart MSTR Elliott Wave Technical Analysis FUNCTION: Counter Trend MODE: Corrective   STRUCTURE: Flat POSITION: Minute {iv}. DIRECTION: Bottom in wave {iv}. DETAILS: Looking for a bottom in wave {iv} to then continue higher in wave {v} of 1 or else there is a case we are in Minor wave 5 and we could be topping in wave (5).   MSTR Elliott Wave Analysis Trading Lounge 4Hr Chart, MicroStrategy Inc.,( MSTR) 4Hr Chart MSTR Elliott Wave Technical Analysis FUNCTION: Counter Trend MODE: Corrective   STRUCTURE: Flat POSITION: Wave (c) of {iv}. DIRECTION: Bottom in (c).   DETAILS: Looking for an ending diagonal in wave (c) of {iv}to be in place, otherwise we could have topped in wave {v} where current wave (b) is and we could be headed lower.   Welcome to our latest Elliott Wave analysis for MicroStrategy Inc. (MSTR) as of June 18, 2024. This analysis provides an in-depth look at MSTR's price movements using the Elliott Wave Theory, helping traders identify potential opportunities based on current trends and market structure. We will cover insights from both the daily and 4-hour charts to offer a comprehensive perspective on MSTR's market behavior. * MSTR Elliott Wave Technical Analysis – Daily Chart* In our Elliott Wave analysis of MicroStrategy Inc. (MSTR), we observe a counter-trend corrective pattern characterized by a flat structure. MSTR is currently positioned in minute wave {iv}, suggesting a potential bottom in wave {iv}. This bottom could lead to a continuation higher into wave {v} of 1. However, there is also a scenario where we might be in Minor wave 5, and if this is the case, MSTR could be approaching a top in wave (5). Traders should watch for confirmation of the bottom in wave {iv} to assess the likelihood of an upward move in wave {v}. This could provide strategic entry points if the anticipated trend unfolds as expected.   * MSTR Elliott Wave Technical Analysis – 4Hr Chart* On the 4-hour chart, MSTR is following a counter-trend corrective mode within a flat structure, specifically in wave (c) of {iv}. The analysis suggests that we may be forming an ending diagonal in wave (c) of {iv}, which often signals the conclusion of the corrective phase. Alternatively, if the market has already topped in wave {v} at the position of the current wave (b), MSTR might head lower. Traders should be vigilant for signs of the ending diagonal being completed in wave (c) of {iv} and watch for potential downside movements if the wave {v} top scenario plays out.   Technical Analyst : Alessio Barretta Source : Tradinglounge.com get trial here!  
    • In the rapidly growing cryptocurrency market, investors face various forms of scam threats. A recent theft case involving a major exchange in Japan highlighted the “fake address trap,” resulting in significant Bitcoin theft. This incident not only revealed how hackers exploit lapses during transactions to commit theft but also underscored potential vulnerabilities in exchange security measures. PTOUNX Exchange has implemented multi-factor authentication and continuous system upgrades to protect the assets of users from similar risks. Through these measures, we strive to ensure the security of every transaction, preventing hackers from exploiting any user negligence. Investor Education: Knowledge as the First Line of Defense Against Scams In the fight against investment scam, investor education and awareness are indispensable. PTOUNX Exchange is committed to disseminating cryptocurrency and investment security knowledge through various channels to reduce user risks caused by information asymmetry. We regularly hold webinars, publish security guides, and update common scam methods and prevention techniques. PTOUNX emphasizes that users must verify every step of a transaction before proceeding, including confirming the legitimacy of the trading platform and checking the accuracy of wallet addresses. Additionally, we encourage users to store large amounts of assets in hardware wallets, as this physical isolation storage method significantly enhances asset security. Our real-time transaction monitoring system can promptly detect abnormal trading behavior, such as unusually large transactions or frequent small transfers, which are often indicators of money laundering or scam. Through proactive monitoring, PTOUNX can quickly take action to prevent potential risks from developing into actual losses. These strategies not only protect user assets but also create a more stable and trustworthy trading environment. Through continuous education and technological innovation, PTOUNX Exchange provides a secure cryptocurrency investment platform for users. Innovative Technology: The Future Protection of Cryptocurrency Trading Facing the complex and ever-changing challenges of cybersecurity, PTOUNX Exchange actively adopts the latest blockchain technologies to enhance security. We believe that by leveraging the transparency and immutability of blockchain, the risk of scam and theft can be greatly reduced. One key technology is the application of smart contracts, which can automatically execute terms of a trading agreement, thus minimizing human errors and opportunities for scam. Moreover, PTOUNX is developing an AI-based anomaly detection system, capable of learning and identifying unusual trading patterns, providing timely warnings to users and management teams. This advanced monitoring technology not only improves response speed but also enhances platform security on multiple levels. Building a Shared Security Line for a Shared Investment Future As the cryptocurrency industry continues to mature and develop, PTOUNX Exchange recognizes that only through continuous innovation and education can we provide a truly secure investment environment for users. We are committed to utilizing cutting-edge technology to enhance our security measures while strengthening user education, ensuring that every investor can make informed decisions based on an understanding of potential risks. At PTOUNX, we are not just a trading platform; we are guardians of investor safety. By collaborating with global security experts and continually updating our security strategies and technologies, we aim to create a worry-free trading environment where every transaction is safe and transparent.
    • Asian stocks rose on Tuesday, tracking gains on Wall Street ahead of comments from several Federal Reserve officials later in the day. The Reserve Bank of Australia kept interest rates on hold at 4.35%, as expected, but warned inflation risks remain. This led traders to cut back bets on an RBA rate cut this year, though the Australian dollar was little changed. Ebbing concerns over European political turmoil also boosted market sentiment. Futures for European stock indexes were higher after gains on Monday. The dollar edged up ahead of US retail sales data, pressuring the euro and pound. The Chinese yuan remained near 7-month lows on mixed economic data from China pointing to a need for more policy support. With multiple Fed speakers on tap, investors are looking for clues on the US rate outlook after last week's Fed decision, with around 45 basis points of cuts priced in for the rest of 2024.
×
×
  • Create New...
us