Monday, August 1, 2011
Market trend analysis for 1st of August 2011
Hi, everyone. Let me do a quick market trend analysis for today. As you may have noticed US politicians will probably agree on debt ceiling and postpone the inevitable collapse. It is good when one can win some time. However, it has to be used wisely by making the right decisions, not faulty ones. It looks like markets are pricing in a positive decision as dollar has been strengthening across the board. Let us look at gbp/usd pair a little and its behavior today.
As most currencies, pound collapsed against US dollar too. Before moving down it formed a nice head and shoulders pattern and with some expectations from big dogs as well as huge amount of money the pattern was confirmed when the 1.6385 level was taken out. You can probably guess that one of the best ways to have traded it was simply to place a short order below the level with a stop loss around 1.6470 level. As you may understand the most logical place to exit the trade was 1.6260 area (previous support).
Trading financial markets carries a high level of risk, and may not be suitable for all investors. All information on the blog is of educational nature and cannot be considered as advice, recommendation or signals to trade in any financial markets.