GBPUSD Follow Up.

Coming back to this Cable trade; it has played out as predicted/ hoped for, and we've seen some good bullish momentum on the 4 hr chart.  It's always tempting to lock in profits at this stage in any trade; but as Lefevere notes, (and I have to keep reminding myself!): it is far too easy to "hope when you should fear and fear when you should hope".  So I will stay with this trade in order to justify the initial risk taken and hope to run it further as planned or get stopped out for a scratch; unless there is a really obvious price action sell signal at these critical levels in which case I will be looking to Cut-and-Reverse. Going into the U.S trading session will be watching to see the markets reaction to the Consumer Confidence figures to give a clue to underlying sentiment.

GBPUSD. Long position entered with stop below yesterdays low.

I've just entered a long position in the above GBPUSD (blue dotted line signifies entry/ red dotted line stop). Rational comes from a sense that we should have sold off today but instead witnessed a very assertive hammer formation on the daily chart.  The 4hr above shows clear trend channel in play which I was surprised to see hold-up during today's session after convincing sell-off in the morning.  I give the trade a 50:50 success rate; but with the element of surprise believe there could be some good upside potential if

EURUSD daily commentary.

Today we observed a fairly substantial down day in the EURUSD above. This rejection coincided with the 38 fib level retracement and previous support around the psychologically significant 1.32 level. However, it should be noted that this still prints as an inside day on the candle chart and by no means represents a decisive change in the recent bullish sentiment for risk assets & currencies. We have observed strong buying of daily lows over the previous couple of weeks and with this kind of upward momentum I am reluctant to get back on the short-side of this Bear Market until we get some more decisive bearish price action. It has been widely reported that there is already an abundance of shorts in this market and any surprise move to the upside could catch a lot of traders off-guard, resulting in some panic driven rallies if this pull-back is sustained and breaks the 1.32 region. 

Before initiating any short positions, therefore, I will be carefully watching the 4 hr chart tomorrow for any indication of renewed selling pressure (eg.. false breaks to the upside/ or strong rejection of highs) to give me an indication of market sentiment around these key levels. Longer time horizon: I still believe there is further downside potential and will be trading with the Bear trend that is clearly still in play on the daily timeframe.

Fundamentally; I do not see the Fed Dovishness as anything new and the dollar has continued to rally quite