British Pound Cross Pick 02.17.2011
I bought into the GBP/USD at 1.6095 following the previous day’s close, and my position is certainly in-the-money as the exchange rate rallies to a high of 1.6176 on Thursday. As the rebound in the pound-dollar gathers pace, I will let the trade close out if we see the exchange rate work its way to 23.6% Fibonacci retracement from the 2009 low to high around 1.6200, but will tighten my stop to cost ahead of the U.K. Retail Sales report as it may fail to meet market expectations for a 0.2% rise. With the short EUR/GBP position, I am looking to hold the position as the exchange rate remains capped by the 200-Day SMA at 0.8448, but will also tighten the stop on the euro-pound to cost as well ahead of the economic releases for the U.K. As we head into the end of the week, I don’t expect to take any new positions, and I may look to retain these positions going into last full week of February as the Bank of England is scheduled to release its policy meeting minutes on the 23rd.
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