The previous day high (near 1.6250) did a pretty decent job of keeping buyers at bay. It was able to stuff rallies three times this day!
Talk about confluence! Not only did we see resistance at 1.6200, but we also got bearish divergence and a long-wicked candlestick form as well!
We got a few releases from the U.K. and the U.S., but what really drove price action was risk sentiment! The marketâs strong appetite for the pound took GBP/USD up from the day open (DO) all the way to the week open (WO).
This day was all about risk aversion, so naturally, the pound took a heavy beating. GBP/USD tumbled from just above 1.6250 and didnât stop 'til it hit the previous day low (PDL).
No big bang to start the quarter! GBP/USD traded sideways and didnât present any big moves, contrary to what we saw the previous day. However, a nice little setup (doji + oversold Stochastic) formed as price tested the previous day low (PDL) and previous week low (PWL).
Playing the retest of the DO would have been your best bet this day. Not only did we see a couple of tests, but we also saw some bullish divergence form! Had you set a target for the PDH, you could have made a cool 40 pips.
GBP â USD TODAY 3 OCT 2012
Current fall is near an end of wave around 1.6102 zone, a rally should then procede to above 1.6168. Fall below 1.6073 would cancel this scenario.
We couldâve made a few pips by trading the midday bounce off the previous day low (PDL). Stochastic was overbought and showed a bearish divergence. Hope you guys caught that move!
If you had had a bullish bias within the week, this would have been the day you would have made a killing! GBP/USD rose steadily up the charts, gaining over 100 pips before finding resistance at the psychological round figure of 1.6200!
GBP/USD was as chill as a polar bear in the North Pole for most of the day. It wasnât until after the NFP report was released that things started to get interesting!
This would have been a tough cookie to play unless you put up a short on the break of the PDL!
Sellers took control of Cable again, pulling the pair down below the 1.6000 major psychological handle. Oddly enough, the U.K. unloaded a whole mess of reports, but none of them really did anything to rile up the markets.
With no hard data released, price action on Cable was pretty choppy. In days like this, it might be best to just sit out, unless youâre comfortable scalping!
From 1.6000, we saw a nice little rally that ended at 1.6050. Not bad for a day trade, eh?
Cable has been kind to me for this week. I went short on mondayâs opening. And i have been holding my short position for 5 days from monday to friday.
I took partial profits along the way and shifted my stop loss to breakeven. Decided to hold the trade over the weekend. The best trades are the worry-free trades. As these type of trades move immediately in my favour without going near my initial stop losses.
Whatâs the platform you use for taking partial profits? Thanks
Scalping off the previous week low may have been your best bet on this day, as price action was pretty choppy!
The week open (WO) held like a boss! It snuffed all rallies and kept the pair from ending the day in the green.
The previous day ended up serving as resistance-turned-support, as Cable bounced right off it near the start of the London session!
Trading off the daily open price would have made for some decent day trades. Even setting a modest target at the 1.6150 level would have resulted in a smooth 35 pips!
