jcpfx wrote:I wanted to brainstorm a little because this trade looked "risky" to me as the short flip level was 5870/80 but on the way up, price formed a bid zone around the daily pivot in the 5850s. I took the trade and exited at the bid zone but was very nervous along the way. Is there any real reason that could qualify my "uneasiness" ?
I'm not sure why you would feel uneasy about shorting into intraday Sterling strength.
Fundamentals are indicating a tricky & very tough trading period ahead with UK Bank chief King reiterating a stagflationary effect (combination of subdued recovery & above average mid-term inflationary pressures) in the Central Bank's quarterly report yesterday, revising down the estimate for growth outlook to a meagre 1% over the next 12 months.
That was further evidenced today with the release of very soft year-on-year/month-on-month retail sales numbers.
Match that barrel of laughs up with the large hourly technicals & you see the over-riding bearish (lower top) bias is still firmly intact.
It's going to require a sustained lift beyond 1.59 to begin turning this unhappy ship around.
Until then it remains a "sell on rallies/short-term strength" play.
Obviously, outside influences will offer short squeeze intraday relief plays, but just refer to your big hourly techs before looking to establish a core structural bias & positional play either via intraday or mid-term swing.
If you're a slightly more aggressive trader & you're playing it via intraday straddles, you can lock in via your 60m cycles (higher low holds) & trigger via your preferred micro-timeframe going up if you can compute positive risk & match it to whatever is influencing the move at the time, other than that wait for the froth to get blown off & when you receive an appropriate signal, such as a lower intraday high/1-2-3/stoch hook combo/cycle sequence (take your pick), re-align yourself with the dominant bias.
