GBP – Should I Stay Or Should I Go?

Could the reason behind Pound Sterling’s broad based sell off today be those ‘in the know’ positioning themselves for ‘Brexit’ or perhaps the ‘weak’ inflation figures released earlier? Or could it be that the trend of underperformance in the UK unit which began last summer is merely extending in an orderly fashion as the chartists might put it?

Whether you trade the markets from a technical, fundamental or ‘flip a coin’ standpoint the important thing is not so much why a move has occurred but whether it could have been captured for profit. On an otherwise dull day for the major currencies two of my systems created to capture moves in Sterling lasting from one to five trading days went ‘short’ earlier today.

My GBP/JPY multiday (MD) system - which holds positions for several trading days – sold at 164.147 (market currently around 162.80) and my GBP/USD day trade (DT) system entered short at 1.44441 (market currently around 1.4300). The DT system exits half of the position after a certain amount of profit has been accumulated, in this case at 1.43653, and moves the stop loss to the entry price creating a near “risk free” trade for the rest of the global session when the position is exited.

While the real reason for a given move can to many be the ‘be all and end all’, traders would do better to follow the SFAQL approach - ‘Shoot First, Ask Questions Later’ when there will be “plenty of time for counting, when the deal is done”.