GBP/USD, July 12 

Downward channel is still intact. GBP showed continued weakness during the Asia session, with COT data for cable at -86. USD shows some signs of recovery during Asia. This is a pair that could trend today. 1,4996 is a valid S1 level, and just got broken and re-tested. I am looking for opportunities to get in short below 1.5050-1.5030. 

GBP/USD, July 12

GBP/USD, July 12

Update, 11am BST, Cable, M5 

Still some room left for the up move. Looking for shorts at the upper range of the channel. 

Update, 11am BST, Cable, M5

Update, 11am BST, Cable, M5

GBPUSD, M5, 1pm BST 

Cable decided to move up sharply, despite weak current account and GBP data. If it finds support at the 200SMA (brown line), we will see more bullish short term movement. 

 

 GBPUSD, M5, 9pm BST

Now I see what I should have seen earlier. The Fib from the initial down move (1.5028 – 1.4950) at the European open was valid all day. The double bottom at 1.4950 marked the low of the day (nicely called by FX13 yesterday at 50Pip’s seminar and Faithmight today!). Next stop was the upper range of the existing down channel (green), clear break up and re-test at 1.4988 (first blue field), spot on the 50% level of the Fib. The US open saw a clear move up to the 100% Fib level, including a break out of the up channel and another re-test of the 100% Fib, to finally form the daily high at the 161% Fib level (1.5088). We ended the day with a quick retracement to the 61% Fib level and sit right now at the 100% Fib level, which, surprise, surprise, is exactly the level where we started the day.

My learning for the day: IGNORE NEWS AND KEEP IT SIMPLE. It was all in the price and the Fib levels. My interpretation of the data made me look for shorts where we ended up going long and vice versa. It’s all there and could have been traded very profitable from Fibo level to Fibo level, once we have found direction. Check out the chart below, and please let me know what you think: