Monday, June 25, 2012

New Short Trade EUR/GBP

I took a new trade on the EUR/GBP pair shortly after the market opened last night(Sunday).   The pattern is a volatility funnel.

The chart shows the funnel and the thin green line shows my traditional entry point.

However, I often take what I call an "early entry" trade and this I what I have done here.   The entry was just after the price action appeared to have made a clear high to form the funnel.   Obviously, this is a higher risk entry than waiting for the break (or a second chance entry), but it often works well and increases the R:RR dramatically as it means your stop (red highlight) is much closer to entry but the target (green highlight) is the same as if it were a traditional entry.

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