GBPUSD: How to Short from Strong Resistance
British Pound/U.S. Dollar FX:GBPUSD
I’m not a fan of trading against the main trend, but when we have an amazing trade opportunity with a good entry point and risk-reward ratio, why not to try?
The price is not far from a strong resistance zone at 1.32000 level. Look at the past performance at this level, and you will see the power of this zone.
RSI confirms the price reversal in the overbought zone. MACD is going to support a possible downward movement. We have a selling opportunity.
Here is an example of a possible sell trade:
Sell below 1.31150
Stop above 1.32150
Profit Target at 1.28150
Risk per trade should be no more than 1-2% from the capital. If the price moves in our direction, it will be good to use a trailing stop.
If the price moves above the local swing high, it will confirm the strength of the buyers and we will have to search for a new trade opportunity.
This post does not provide financial advice. It is for educational purposes only! You can use the information from the post to make your own trading plan for the market. But you must do your own research and use it as the priority. Trading is risky, and it is not suitable for everyone. Only you can be responsible for your trading.
Source: TW DLavrov