BarroMetrics Views: A Goodbye
Has it been ten years? Almost, I first started publishing this blog on November 1, 2007. I’ll stop publishing on Tuesday, July 19, 2017.
That said, the blog articles will be available until December 10, 2017. This will give you time to download any articles you may want to keep.
Thank you all for stopping by. I have made some good friends here, Baz, Chris, Jason, Thomas and too many others to mention. All the best with your trading, every success.
Turning to today’s entry: I’ll finish the commentary on the GBPCAD trade. At the July 12 presentation, I started the analysis, but we couldn’t see the beginning of the trade because the BoC’s figures came out at 22:00 Singapore just as the presentation concluded.
Those of you who attended will know I was looking for the BoC not to raise rates. I mapped out a strategy for the expected ensuing rallying. I also mapped a strategy if it did. In the latter case, I concluded that:
- given where the pair was trading ahead of the number; and
- given that I expected the daily range to be between 190 – 300 pips, I was not prepared to sell the pair on the news.
- Instead, I said I’d wait for the rally.
The BoC did raise rates. The GBPCAD then fell; we saw 315 pip range for the day. So, yesterday I was looking for a rally.
Figure 1 shows provide two important bits of information:
- Acceptance above the blue 120% (1.6789, I’ll round that to 1.6790) tells me that the current structure, the 5-day swing downtrend, is probably over; breach of the 5-d swing high at 1.6975 will confirm).
- The red lines show the 5-day resistance levels.
Figure 2 shows the 60-minute chart with resistance levels. Yesterday, the GBPCAD moved into the bottom of my preferred zone, and I took the trade at 1.6473. My initial stop (hard) is above 1.6616; my soft stop is above 1.6577.
Yesterday, the GBPCAD moved into the bottom of my preferred zone, and I took shorts at 1.6473. My initial hard stop is above 1.6616; my soft stop is above 1.6577.
(By ‘hard’ I mean ‘the stop order is resting in the market’; by ‘soft’, I mean I’ll be looking to exit should I see acceptance above 1.6577)
I believe there is a 50-50 chance will see a test of 1.6530 to 1.6565 today to establish a congestion high on the 60-min. The congestion low is at 1.6354.
I’ll publish an update at 20:00 tonight Singapore time.
FIGURE 1 GBPCAD Daily
FIGURE GBPCAD 60-min