As it was NFP day, I had already said to myself that I would not enter ANY trades prior to the NFP release at 1.30pm GMT. Around one hour after the release I shorted GBPUSD from the 1M timeframe. Shorting this pair was in line with the market sentiment on the lower timeframes. Additionally the pair had dropped below the 1.6000 level (referred to as a “triple zero level”) and had then failed to even get back to that level. Hence it would be reasonable to assume that this level would provide strong resistance. Arguably I was over-generous by setting the stop at the EMA100 level at 1.6017, effectively created a stop size of 32 pips. The eventual result of 22 pips profit was therefore a gain of 0.65R. Had I used a stop of say 1.6008 thus a stop of 23 pips then the gain would have been just shy of 1R.
I managed the trade on the 1M timeframe and moved the stop down as it went into my direction. Eventually I set a target of 1.5943, just in front of one of the pivot lines. However price didn’t reach there – I was hoping it would spike down to that level and that allow me to re-enter at a higher level. I closed on the completion of a bullish XO.
I wish all trades would trend as smoothly as that one.