(Partial video transcript)
This week’s trading opportunity
Axel Rudolf: Hello everyone and welcome to the “Office of the Week” on Monday, December 1st. And what I would like to do today is go long EUR/GBP because I think the last few days have given the analysts, I should say, enough time to analyze last week’s UK budget, and maybe we will see moves that we didn’t see last week.
Additionally, since Thanksgiving ended last Thursday and Friday, many people were not as involved in the financial markets. So we might see a reaction now and that’s perhaps what we’re seeing today. We can see on the EUR/GBP chart that we are already moving higher, having traded sideways for three days since last week’s quote.
From a technical perspective, I like this trade simply because, as you can see from the May lows, we have a very good uptrend and we bounced off it. So that’s another reason to believe that the corrective move we saw from the high seen in mid-November might be over and that we are moving back up.
Now could I come in right away? Probably not, because from a risk/reward perspective, my goal isn’t that high. So right now, it would be a one-to-one risk-reward scenario. So I prefer to wait for a minor pullback towards £0.8775, for example, to re-enter with a very tight stop below last week’s lows here, just below, at £0.8745.
Business results of previous weeks
Now I would like to talk about last week’s “Trade of the Week”, which was going long the S&P 500. You can see the horizontal line where we went long on the chart in the video. Excellent trade! My bullish target was 6,800 or more. So you can get out of this business now and also because the end of the year is approaching. I would like to keep my trading statistics ideally above 20%, risking, as you know, only 2% of capital per trade. I think I’m going to cash this one in at 6,812.
And during the week before the second to last, I made a mistake. Yes, it happens to all of us! So, I basically took long positions on GBP/USD. We did it at the beginning of November. The situation was immediately in our favor, but we did not reach our bullish target. And what I did then was move my stop from that low to the next lower low. And if I hadn’t, we’d still be making a profit. But they basically stopped it with a small loss here, and yeah, then the market went back up.
This week’s trading summary
For this week’s “Trade of the Week”, I would like to go long EUR/GBP. I’d like to do it at £0.8775 with a stop loss of £0.8745 and an upside target of £0.8815.
