GBP/USD 1HR
This is the GBP/USD 1HR currency pair in a near perfect 5 point falling wedge formation. If it trades as a normal falling wedge it will break to the topside of the trendline and has the potential to move up 1000 pips as a 50% retracement.
This is a higher risk trade as it is counter trend and not what I like to do. It does present the opportunity on the way back down for a very nice trend resumption pay out that is a less risky trend trade. Current price is 1.4900 and 50 fib on a 4hr chart is 1.6067.
WAIT FOR YOUR TRADE…This is the trade set up, you can box it in. Trade on the breakout of a box that goes off of or through the trendlines. Then move your stops to break even and let it run.
UPDATE 11/25/08 THIS TRADE IS UP 525 POINTS AS OF THIS AFTERNOON, although it did have significant drop but no loss – of 175 pips at one point. This shows the power of longer term trades.
Update 9/21/10 This trade is best taken long from position 5. You can have a minimal stop at this point.
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November 30th, 2008 at 6:47 pm
“Just reading your past blogs and this was an awsome example of a falling wedge reversing the market”
November 30th, 2008 at 6:55 pm
Yes, put this pattern in your memory banks for future trading opportunities.