There is no doubt that trading successfully is about choosing the right currency pairs to trade.
It’s not about the entry system, not about the indicators you use, not about Fibonacci, not even about price action… but the charts that you choose to trade.
The most powerful system wont make you some pips out of a crappy chart.
See what I mean?
So please, forget about your entry system and start doing some analysis, filter out the choppy charts from the clear ones… and results shall come.
Ok, so here we go…
I dont know if you remember a few weeks ago I did my analysis on the GBPUSD, this was the daily chart:
And this is how it looks right now:
Back then I was looking for long opportunities since the GBPUSD got rejected from the bottom of the range…
And it did go up (look at the second chart).
Now it looks like its being rejected from the top of the range…
What would you do now?
Well, history tells us that since the GBPUSD was rejected from the top of the range, it is likely to continue its way down until it reaches the bottom of the range.
And that’s what I’m going to be looking for.
I’m not saying that you should open your trade now… this type of analysis is made to determine whether I’m going to trade this pair or not…
In this case, yes, it’s as clear as water, so I’m going to be looking for short opportunities.
Now, finding my entry signal is a different story…
Here is the short term chart:
As you can see, the market has been acting little crazy in the last few hours… do you know why?
That was because of BOE Governor Carney speech.
So right now I’m going to wait until the GBPUSD settles down, and then I’ll look for my entry.
This analysis is good only if the GBPUSD keeps trading below 1.5544. If it breaks that level up I’ll need to reassess my analysis.
I’d be even more comfortable shorting the pound/dollar once it breaks the 1.5428 level…
What do you think about the GBPUSD? Are you currently trading it?
Do you agree with me that your analysis is the most important aspect of trading?
Leave a comment.