GBP/USD Analysis and Trade

Finally it broke out the bull flag and i have my entry too

The trendline i drew on the previous chart gave way hence i didnt enter but it fought back bouncing along the bottom trendline and produced a nice pinbar candle to take it back to above 21ma.



I didnt think it was safe to enter until the bull flag was broken though and i even missed the initial rise but waited for the pullback on one hour to horizontal support and the bullflag trendline which was broken. Order to enter was in at 16525 which was triggered which much in a nice area



Stop was originally 100pts but this has now been moved to 16493. The limit is a problem now as this has the potential to go to 17000. massive resistance there with 200ma too. I initially was looking for 16725 but the way it broke so quickly to the upside suggests there is potential to gain 4/5 times my risk. i shall monitor

GBP/USD Analysis cont.....

Now we have our price action setup, im looking to enter long. Along with the inside bar, we are importantly with the trend and have bounces off support which adds to the bullish case

Entry - i would enter above the bull flag, so a order would be in at 16546. Normally i would enter just above the "Mother" candle which is the larger candle of the inside bars but as we have that bull flag upper trendline, ive adjusted the entry

STOP - 16460. Low of the Mother candle plus a little more allowing for spread

LIMIT - 16718. The limit has to be at least twice the amount of the stop. Risk/Reward is important as they allow your winners to be bigger than your losses. so for example you might have 3 losing trades and 1 winner but youd still be in profit due to the size of the winner

GBP/USD Analysis

Taking a birds eye view of cable, its had a nice bullish run since the Dec 2010 lows. The Daily charts shows nice setups forming if you used pin bar candles, especially with that strong support at 15976.

As the trend is up and the next big resistance area (looking at weekly) doesnt come until the 16740s, im looking if this trendline support now holds. If it does, id look for price action formations around this area.