Paper trade: Short GBP/USD 50% @ 1.634, Out 1.645 (-110 pips)

Well, that descending trendline didn’t last long for GBP/USD. I shorted it when it was testing it and saw that the RSI was at a prior high too (Fig. 1). I placed my order just below the short-term ascending support to hope for a break to the downside, see Fig. 2. GBP/USD consolidated around that short-term support for a few hours and has now broken upward to a strong resistance at 1.6600. It’s the top of a previous congestion zone, highlighted rectangle in Fig. 1.

GBP/USD at 1.666 is a very tempting short, but never short a new high, as my rules say. So I’m gonna wait for a few more hours with this and see how it goes.

Position size: 50%

Entry: 1.634

Stop: 1.645, stopped out.

Target: 1.6100

Reward / Risk = 240 / 110 = 2.2 < 3, so only 50% position. I think I’ll stick with the 3 factor as a limit. Even these 2+ trades aren’t working so well for me because my probability of success has been low.

GBP/USD

GBP/USD, 3 hour

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