This trade presents a considerable level of risk and can be classified as an opportunistic move based on recent price action. The GBPUSD currency pair has experienced a substantial bullish rally, surging by nearly 500 pips in a strong upward movement. However, after this extended period of appreciation, the pair is showing signs of a potential correction, suggesting that a short-term pullback could be underway.
Recognizing this opportunity, we are entering the market with a direct sell order at the price level of 1.2950, anticipating that the correction will continue. To manage potential downside risks and limit exposure to unexpected market fluctuations, we have strategically placed a stop-loss order slightly above 1.3020. This level provides a safeguard in case bullish momentum resumes and pushes prices higher, preventing excessive losses.
On the profit-taking side, our target is set near the 38.2% Fibonacci retracement level, a widely recognized technical indicator used by traders to gauge potential reversal points within a trending market. This level represents a logical area where the price might find support and resume upward movement or consolidate before determining the next direction.
Profit & Loss
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