GBPUSD—correcting

I bought last Tuesday at 1.5562 and the pair moved up nicely to a high of 1.5896. This morning it sharply reversed down to a low of 1.5719 which causes concern as it's lower than yesterday's low. I took partial profits at +200 pips this morning. 1.5655 should contain further drops. Below 1.5511 would show real weakness and the next real support would be 1.5287.

If you look at the weekly chart you can see Cable has had two bullish weeks with last Friday's close. You can also see it's at resistance so stalling here is no surprise. A clean break above the resistance line would target the 1.5998 high.

Here's the weekly chart. My trades don't show on this chart as I use a different charting package for longer than daily charts.











© Dianne Fecteau, 2010. No part of this material may be reproduced in any form, or referred to in any other publication, without the express written permission of the author.

My purpose in writing this blog is to show you how one trader, me, makes trading decisions and survives while trading Forex. One of the biggest problems I had when I first started trading was trying to apply the “rules” to actual trades. Another was the psychology—limiting losses and letting profits run. If you study my blog, you’ll see how I deal with both those issues. So my writings are not trade recommendations but rather educational in purpose. You have to decide on your own approach to trading. Remember that trading is risky.