Wait for the pullback to short Cable

OANDA:GBPUSD   British Pound / U.S. Dollar
Cable has been in a long-term down trend for 10 years, it never recovered from the highs of the 2008 crash up @2.1 (those were great New York and Chicago shopping trips), we had a 50% fib pullback into 1.7, continuing the downtrend to 1.6 by the end of 2017, Cable was already falling before Brexit.

Since 2017 we've been in an uptrend within the boundaries of an ascending channel and now we're in a pullback, but have broken out of that channel after the Jan - April double top , bouncing at previous support @1.3065. The next moves are critical, do we continue the downtrend and retest 1.6 or break 1.34565 and move up to 1.4 and beyond.

We don't know the future, we never will. But Brexit and probabilities are high for a continuous move down, after a reasonable attempt at moving higher towards 1.345.

I won't be buying this pair unless I see a very strong move higher on a daily, 4H and 1H timeframe and one that holds support with strength, so I remain long-term bearish .

I'm looking to sell below 1.345 and holding long-term down towards 1.5, I may also hold larger swing trades to capitalise on the inside moves.

Comment: We're still Bullish after breaking out of the long-term Bear channel last year, but this pullback was deep enough to cast serious doubt on a recovery, a move below 1.30655 and lower will confirm a continuous move to the downside long-term.

Comment: On the weekly chart the DXY is moving sideways since May 18 but with serious bearish candles, but it still managed to break (and fail) 95. If the DXY falls through 94 due to geopolitics then this pair is going higher, but the economic numbers in the US are strong and it's one of the few economies that is increasing interest rates.

The short term weakness of the DXY will help this pair move to the support zone

The BXY on the other hand, is seriously bearish, but with a very large candle signifying a move higher, but not very much before it hits a lot of resistance if that coincides with negative news, then a fall will follow, but again, short term support for moving higher.

Comment: This is why we cannot short the Pound right now, look at those candles on the daily, rejection, rejection, rejection @1.31 a break-through that because of a negative Brexit review or significantly poor economic data would change everything.

Comment: As forecast, we're moving up towards resistance, this move is in itself worth a trade, but I'm more interested in the longer term move and testing that zone first.

Comment: This is why I cannot buy these longterm bears, you've no idea where it will be rejected and rejected hard.

Comment: We're approaching a critical resistance area now, I do feel with the decline of the DXY at the moment, that we could easily break it and move higher, but these long-term resistance zones take a lot to penetrate, especially with all the BREXIT talks going pear- shaped, I;ve sold other Sterling pairs, Aussie etc already and moved 100 pips overnight, so don't expect this to rocket just yet.
Comment: If we break the trend line, we're going back to the bottom, nice!

Comment: Will the trend line hold? My Aussie $ trade has already dropped far further.

Comment: 50% profits taken and due to the poor numbers and the state of BREXIT. I'm focussed on the next targets below 1.30

Comment: Next targets 1.28 - 1.29

Comment: Still sat in this trade for most of July, I'm still targeting 1.29 and I see no reason why the pair isn't going there. Patience is the key!

Comment: Sorry, not 1.29 the target is 1.30 at the bottom rotating to the bottom of the channel
Comment: We're still moving to the downside, this is turning into a lovely trade, I've done well out of Sterling pairs this year

Comment: Taken another 50% profit.


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