Newbie shorting GBP vs USD

Discussion in 'Forex Trading' started by Option Trader, Dec 11, 2008.

  1. If I am right that the trend of GBP vs USD will bring it from 1.50 to 1.40 over the next week, but within the trend , how big may the intraday fluctuations in the wrong direction?
    I.e., if I will short 17,000 GBP, and the margin rqrmt is 40:1 or 4,250 pounds, what buffer would you recommend so I don't get stopped out intraday?
  2. dhpar


    there is no magic number.
    study the chart, find the supports and resistances and act accordingly...
  3. I'm going with the premise there would be a degree of intraday manipulation to stop people out, but that this would have a limit how far they can go (or would go noting it's a small trade). No thought as to a limit?
  4. hedonQ


    It may be, 1.40 is doable.

    However, it seems we've based around 1.45, we've broken a down trendline and series of higher lows on the dailies
    "may" indicate a bounce past 1.50 levels. A greater bounce might be on the cards anyway.

    EUR/GBP ripping new all time highs last week, possible stalling the bounce in cable. Cable was certainly under performing last week.

    UK economy is a disaster, but what we know so far, lot of it is priced in at these levels.

    I think strategically you're correct, however tactically no. Wait for a bounce to 1.60 - 65 area.

    Good Luck.
  5. ssbc19


    It seems like a lot or risk to be taking to short from 1.5 to 1.4 since it's already fallen from 2.

    I also agree with HedonQ, 1.45 has held twice now.
  6. Doesn't it ever happen in forex (like it does in stocks) that smart traders load up at certain baselines, not realizing their counterparties are powerful market makers, who then rook them?