GBP/USD: Double-Bottom at 1.9700 and Major Bottom at 1.9654 Will Push Cable Back to 2.000?

Tuesday, January 8, 2008

GBP/USD: Double-Bottom at 1.9700 and Major Bottom at 1.9654 Will Push Cable Back to 2.000?

Daily Chart

04-Hour Chart

30-Minute Chart

(CLICK ON THE CHART TO ENLARGE IT)
As posted on Sunday Jan. 06th, the 04-Hour chart showed a double-bottom at 1.9700 at exactly 161.80% fibo projection with clearly bullish divergences at RSI and MACD. Now with the low on Jan. 07th we have a major bottom at 1.9654 with dailies also showing divergences at RSI and MACD. Cable is bullish. Points are:
BUY a dip at any level, especially 1.9650 and 1.9700, all with tight stops. 1st LIMIT at 1.9900.
If bearish trend resumes, SELL break 1.9654 with STOP 1.9675 and LIMIT 1.9470. Watch for false breakout at 1.9654.

TRADING STYLE

Even though we are considered Day-Traders, our trading sometimes requires different styles, according to the patterns and/or how the market moves during our trading sessions. All strategies presented in all posts below are for Positioning but, depending on how markets behave, our style can change so that we can capture good trading opportunities......

Our Trading Styles are discriminated as below:

1) Scalping: Short-term trades, usually betwen 2 to 15 minutes, with stops lower than 8 pips, targeting 15 pips. Generally our Scalping trades apply very low stops (5 pips) aiming quick surges in prices of around 10 pips, in a matter of a very few minutes.................................................................................................
2) Day-Trading: this is our main Trading Style where we dedicate most of our time. Their lenght is usually betwen 10 to 60 minutes, sometimes for more than 2 hours, with stops between 10 and 20 pips and targets between 20 and 60 pips...
3) Positioning: Long-Term trades based on Daily and 4-Hour charts, with stops between 20 and 40 pips, targeting minimum 60 pips. Most of these trades have Open Limits......................................................

Money Management

This is a crucial aspect of our trading, considering the different styles we apply to our trading Sessions. As the Positioning Style requires larger stops (usually the double of our Day-Trading Style), their lot size is lower than usual, generally 50% of our standard lot size. As the Scalping style requires lower stops (usually half of our Day-Trading style), their lot size is usually 150% of our standard lot size. For instance: let´s suppose that our current standard lot size is 200K. For Scalping trades the lot size will be 300K and for Positioning it will be 100K...................................

Daily FOREX Analysis - Brasil

Tuesday, January 8, 2008

GBP/USD: Double-Bottom at 1.9700 and Major Bottom at 1.9654 Will Push Cable Back to 2.000?

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