If you were able to identify the GBPUSD Long trade set-up and took the trade, that’s great. I took it, and, currently, I’m still in it. It was slightly nerve-racking as price surged downward toward the initial Stop Loss before it reversed just 5 pips to the Stop. I’ll explain the steps I’ve taken so far in managing the trade. Please NOTE that the Daily chart, above, isn’t really supporting a Long trade as price is currently forming lower highs and lows; though, a retracement is occurring, price is testing the upward trend-line – a potential resistance area. More conservative traders would have refrained from this trade. Personally, what I did was to reduce my risk. The H4 chart, however, supports a Long trade.
On the Hourly chart above, price pattern was forming higher highs and higher lows; hence, I drew the Fibonacci tool using the most recent Hourly swing low @ 1.6261, and the temporary price-top @ 1.6380, and then identified an area around the fib. 78.6% ret. level as a potential price reversal area to place my Limit Order (Pls NOTE the 78.6% ret. level was supported by pivots, other fibs., and previous highs). Initial Stop Loss was placed 2pips below the most recent Hourly swing low @ 1.6259 (broker’s spread included). Primary profit target @ 1.6411 (two pips below the fib. 127% ext.).
On The 15min chart above, after the Limit Order was triggered @ 1.6294, price continued downward – almost stopping me out, but then reversed sharply. Afterward, as price moved almost 30 pips in my favor, and struggling to stay above a Weekly pivot @ 1.6312, keeping the dissenting Daily chart in mind, I decided to move my Stop Loss to break-even. As price moved further upward, I exited one out of two lots @ 31-pip profit (precisely 1.6325). With that, the trade is already profitable. The profit target for the second lot is 1.6411 (117pip profit). Further Stop Loss adjustments would be based on new Hourly swing lows.
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