Thursday, November 18, 2010

EURGBP—corrective structure

The pair has been meandering in a corrective structure that could be an ABC correction. I've labeled it on the 1-hour chart as such so the next move should be down. If wave C equaled A the price would be .8565—the pair reached .8552 where it also ran into a couple of resistance lines. The triangle I wrote about yesterday is still a possibility but there's no real fibo relationship between waves ABC which one expects to see. If it was a triangle, one would expect a price target for wave five of at least .8347.

Now to see what happens as it approaches.8463/43. The Nov. 11th low was .8450; this is also the price where it hammered out a base as well as being the .618 retracement of 8143/8941 and a price support. I'm short from .8511 (I was taken out of my first one at breakeven and went back in).

Here's the one-hour chart:

© 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.

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