GBP/USD 12 JUNE 2012

GBP/USD - follow me on twitter @fxdailyforecast and stocktwits.com/fxg

Price gave us the bearish cs formation we were looking for yesterday.

FOR TODAY:

We are still in the same AB swing, having shorted yesterday. Today is a DABF786 trading day where we will look for another short entry, maybe after a rally and a bearish cs formation looking for price to test 5410.

A bullish cs formation from current levels or circa 5440/20 will initiate a long trade setup based on a DD entry and should be good for 100 pip rally. Will wait and see what materializes.

If we don’t get the setup we are looking for then we don’t trade.

SHORT: Will be going short only IF:

Today is a DABF786 trading day where we will look for price to continue down to test out limit at 5410. Price can either fall from current levels and take out the 5461 overnight low, or rally and give us another bearish cs formation before heading lower. Place stop 13 pips above the cs formation, max 1% risk. Limits will be down at 5410.

Bullish support circa 5440/20 will call for an exit of the short position, stops at cost.

If we don’t get the setup we are looking for then we don’t trade.

LONG: Will be going long today only IF:

Bullish support from current levels or lower down circa 5440/20 will initiate a long trade setup based on DD principle showing us that support is holding and will be good for a 100 pip rally.  Place stop 10 pips below the cs formation, max 1% risk.

If we don’t get the setup we are looking for then we don’t trade.