Kumowizard
Short

GBPUSD - Watch for short! Or go short.

FX:GBPUSD   British Pound/U.S. Dollar
106 6 0
The trend is still up. The question is for how long? Until the trend clearly ends and maybe reverses, we can not say a double top is in. I always like to see it confirmed and announce it in past tense, rather than predict it too early.

Daily Slow Stoch turning down, and there is serious deterioration in price action on the 4 Hrs chart too. Good chance for the cable to come as low as 1,6660, or maybe down to 1,6610. But that is still a small correction within an existing massive uptrend.

On the daily chart the price is in a tightenning range, in between the uptrend line and the horizontal resistence. The really interesting level is between 1,6530 - 1,6610. If price breaks the uptrend and also validates a Kumo breakout on the downside, then we will see a nice downtrend to unfold, with the firt target at 1,6000.

Strategy alternatives:
1. Sell at mkt px             with stop at 1,6770
2. Accumulate shorts in more clips between 1,6700 - 1,6780, with stops above the horizontal resistence (1,6825)
3. Buy put options with strike px             between 1,6500 - 1,6550. Maturity should be 1 month or 2 months, not to get killed by the Theta very quickly.
Reminds of this tweet from bond vigilantes... https://twitter.com/bondvigilantes/statuses/449534543985270785

That said, a 'test' to the upside cannot be ruled out. But there is weight to what you said. We can't know until its established.
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Kumowizard PRO justatrader
2 years ago
Thx for sharing this tweet. I haven't read it so far. Then we may be right. Anyway, if I take this trade, I will do it based on my tech setup only :-). Look at the Puts. I think this is really a proper way to establish a bearish position. Later if we see more signals, we can add outright shorts to.
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Just checked the price for June 1,6550 Put. It is appr. 77 pips. I think this is quite cheap. Mid volatility is ard 5,60 % only. Maybe accumulate puts is the best strategy for this short idea. Since the Contract Options quoted on Globex are very liquid, I suggest to take the position there, not on FX OTC options. Then in case you want to stop the Long Put before maturity (in case price breaks on the upside and you do not want to loose the whole amount of the premium paid), you don't have to cross such a big bid/offer than on an OTC option. Of course this is only a solution for those who have sufficient margin and capital on the trading account, as 1 lot of a Contract option is ard 103.000 USD nominal. Looking at the risk, Delta is only ard 0,3.
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threetooltrader
2 years ago
So on tradeingview are the candles the only thing that update? Seems like the Chikou, Tenkan, nor Kijun moved when you press play. No big deal just that being precise with the charts makes a big difference?
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JimPansen threetooltrader
2 years ago
Just use the "Make it mine" feature and use everything in your own chart. Up to date of course!
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Kumowizard PRO JimPansen
2 years ago
Thx for the info. Very useful, as I did not know it either.
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