Descending Triangle Trade Update 12/10/2010
On Monday we took a short on the GBP/USD from 1.5932 after seeing a nice descending triangle chart pattern formation with a bearish shooting star reversal candle formation. We closed half for +20 pips during the NY session and let the last half run. Today I updated the trade by setting the stop loss to 1.5832 which means worst case scenario the last half of the trade is closed out for +100 pips, not a bad trade at all! As of writing this the market got to within one pip of closing the trade for +100 pips and is still around the same area. I will not adjust this trade until tomorrow’s NY session at 7:30AM EST, if the trade is still running that is. Either way this is going to end up as a great trade. From a daily chart perspective we have 2 very nice bearish candles, however the EUR/USD just formed a huge bullish daily reversal candle (Red Arrow) Given the fact that the EUR/USD moves more money than any other pair, if it does continue up in the direction of yesterdays bullish hammer formation it could cause the GBP/USD to go up as well and more than likely would. Either way great trade, and we will see what tomorrow brings in the live forex trading room. See you all there!