Since last night the pair has been swinging wildly from 1.4764 down to a low of 1.4476 and back up recently to 1.4724. One of the explanations I read for the move back up this morning was, the writer contended, because of Moody's pronouncement that "UK election outcome no direct threat to UK AAA credit rating." As if. What was their explanation for the move down, I wonder. No doubt the UK election outcome. The pair is swinging because of uncertainty, because of moves that went too far, too fast, because of kneejerk reactions, because it is. Save the tired explanations.
The 1.4720 price area is a fibonacci confluence zone so if it can make it through there then further gains might be possible. There is some positive divergence on the hourly chart but divergence has been common recently. Additional resistance is at 1.4747/64, 1.4868, 1.4929 and 1.4994. If it falters then shorting is the way to go. Support is at 1.4661,1.4597, 1.4476 and 1.4397. I shorted at 1.4680.
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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