Day Trading Setups Review

This is a brief summary of the events on and around the FOMC trading day. We did very well in our Training Room.

By Marco Hering
9/19/2013 

Trading setups in the GBP can be very rewarding, however you must have a plan...Today, I want to go over some of my favorite trading setups. One of my favorite pairs to trade is the GBP/USD. This pair  took out an important resistance level in the weekly chart last week, and I was very bullish on this pair. I told the members in the Live trading room that I expected 1.6150 very soon and then I would look for a long entry. As you can see the pair hit that area now and is facing trend line resistance.

 When To Execute the Trading Setups in the GBP ?

I was bullish on this pair I did not find an entry for this move. My buy zone was placed between the 100 and 200 hourly EMA. A look at the chart tells you that the pair never retraced enough to jump on the train here. No retracement came close to the 100 hourly EMA. The very dovish FED statement yesterday, caused a sharp rally in the GBP/USD. The pair was obviously very overbought in the European session, but I was not really eager to counter trend trade. Pretty disappointing retail sale numbers were enough reason to take a little scalp trade though. I went short with half size at 1.6091 and closed the trade for +20 pips at the daily pivot. Things did get a bit tricky here for long trades after the retracement since we are at resistance in the weekly chart. Nevertheless, I would still look for long if it comes back to the EMAs and makes a re-test of the 1.5950 area but only if we see some buyers down there. By the way: My old buy zone worked out pretty well. Anyone who got in and was brave enough to hold through the FOMC meeting could have closed the trade for about +600 pips after the FED decision.

 Day Trading Setups on the EUR/GBP

Since I was very bullish on the GBP and the GBP/USD just did not want to give me a pull back move to get in I had to look elsewhere to get a trading setup. EUR/GBP looked promising if I wanted to go long in the GBP. EUR/GBP broke key support and made a re-test. This a a classic support becomes resistance scenario.

You can see the 30min chart below. The pair made a lower low and retraced back to the EMAs. I went short at 0.8391 when I saw some selling coming into the pair. The pair went lower slowly and I decided to close half at 0.8371 for +20. I went long with a small position at 0.8364 but was still net short. ( about 2.5 to 1 ratio). The stop for my short position was at my entry level and the target very wide. The stop for my long position was at the TP of my short position and the TP was the stop of my short position. In the end my short position got stopped out at break even while I got +28 pips on my long position.

 Day Trading Setups in the AUD/USD

Congratulation to the members who held the AUD/USD long off my buy zone that we took couple of days ago. Our entry was 0.9317 and we are at 0.9500+ right now. I got out too early, I have to admit but it is not very common that the weekend gaps are left unclosed. The pair hit the 38.2% Fibonacci retracement in the daily chart at 0.9512 and I think we can see the 50% Fib retracement level as well which comes around 0.9730. I got a new buy zone now as you can see in the chart below. In close, Trading Setups require alot of research but in the end it pays to work hard. You can see more on these trades and videos in our members section.

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