GBPUSD - Sell signal from break and failed retake of channel
The British Pound has had a wild ride in the last 24 hours with major volatility inducing events. That volatility has caused a downside break of the long running bullish trend, with a failed retake of the trend. Upon attempting to retake the channel price has failed to retake the trend support and has also formed a small bearish pin bar and continues to hug the bottom of the trend as resistance. If price continues to be unable to retake the bottom of the channel we could see price fall sharply lower. A tight stop loss could be employed somewhere above the bottom of the channel, in case price were to reclaim the channel support. This offers a very compelling risk/reward setup on the short side.
Trade closed manually:
Closed out the trade for a nice scalp. There are 3 weekly bullish pinbars/hammers that I dont feel comfortable trading against for the long term. I will need to see a large bearish price action signal on the daily to get short for a long term trade.
Trade active:
Re-entered short @ 1.3266. Price had continued failed attempts to retake the channel on intra-day charts so re-entering.
Trade closed manually:
Intra-day bullish engulfing bar formed off of pennant support so defensively closed my position for another scalp. I will considering re-entry if there is yet another bearish sell signal off of the bottom of this channel. Continue to improve my cost-basis for future short positions on this pair.