[dlw1999]

Not a bad day today in the GBP/USD. Survived the test of the 61.8 retracement of 1.9589 to 2.0131, 38.2 retracement of 1.9182 to 2.0131, the 55 Daily EMA of 1.9768 and yesterday's low of 1.9770.

The result was a buy signal on an IB on the 15min at 1.9767, on the 30min at 1.9776 and the 4hr at 1.9803.

The 15min chart was a bit erratic and may have caused an early exit, especially if you took the second entry at 1.9783. The news release in the opening of the New York session caused a move below the entry IB and the prior bar down to 1.9773.

Mike6nov asked how to avoid the losing the paper profits. One of the reasons we should all trade this market is that it "tends to trend". I'm not saying the whipsaw doesn't happen (see post#388), but once the market chooses a direction it tends to continue on for some time. For instance the general trend has been solidly down since May1 from 1.2071 to 1.9759 this morning, over 300 pips.

Even on shorter time frames it happens, today the trend has been up since the low and the entry signal at 1.9767 on the 15min chart. I made the entry on the 30min chart and waited for the break of the 1.9770 and looked for price to move back to the daily pivot at 1.9842 (which is the high for today on the nose).

I set my stop at 1.9760 (the bottom of the IB I entered on) and waited, rather than trail the stop looking to lock in 10 or 15 pips. It was agony at times as price struggled at the news release coming down below my entry, took forever to get through 1.9803 and finally moved on to the high at 1.9842

You absolutely have to follow the rules of your trading system and stops are critical to staying alive, but you also have to know where you are in the trend and where critical support and resistance lie. Sometimes the smaller timeframes can be like tunnel vision.

David