As a side note, trades in the SGDJPY and NOKSEK discussed in the October 26/27 Forex Trade Signals are well underway and currently onside about 4X our initial risk.
EURGBP Forex Trading Signal
The EURGBP is moving in an expanding range since late August. The price is currently at the bottom of that expanding range. It spent a couple sessions down there consolidating, and has begun to drift to the upside. This trade is based on the expanding range continuing, and the price moving back to the upside.
The long Entry is 0.7205 to 0.7195. Stop Loss is 0.7163. Target is 0.7450. Reward to risk on the trade is about 6.5:1.
Main risk here is the volatility which may surround the US FOMC announcement on Wednesday. Even though this isn’t a USD pair, it could have some whipsaw moves. The stop loss isn’t that far from the entry, so an alternative is to wait until after the announcement to trade.
GBPCAD Forex Trade Signal
The GBPCAD has been rallying higher since mid-October. The rally has put the price right in a longer-term resistance area though, based on the downtrend on the 4-hour chart. This short trade is based on the longer-term downtrend continuing.
The short Entry is 2.0291. Stop Loss is 2.0335. Target is 1.9850. Reward to risk on the trade is about 10:1. If the price rallies more than 20 pips above the stop loss before dropping through the entry price, cancel the trade.
Same problem here as in EURGBP. With the volatility surrounding the news events of the week this trade could be stopped out before it even has a chance to get moving. An alternative is to wait until after the announcement to trade.
Chart times are in GMT + 3. Forex prices vary by broker, sometimes significantly.
If risking 1% per trade (recommended), if the main target is hit the reward:risk for that trade describes your percentage gain (for example, 6.5:1 means you make 6.5%).
If the price moves more than 50% of the way to target, start trailing the stop loss in to lock in a profit. Once the price is 50% of the way to the target drop down to a 30-minute chart and adjust the stop loss to just above the closest short-term resistance level if short, or just below the closest short-term support level if long. Continue to do this until either stopped out or the target is reached.
Alternatively, let the trade play out; it will eventually hit the target or stop loss.
Trading involves risk. This is for informational purposes only and is not trading or investment advice.
Disclosure: Author is short SGDJPY and NOKSEK, and long EURNOK. Orders pending in GBPCAD and EURGBP per above.
Follow on Twitter @corymitc for more trade ideas.