June Trade # 8 - BUY GBP/USD

June 4, 2009 6:00 pm (Manila)

2nd lot is out at +83 pips.

Summary for this Trade:

1st Lot: +30 pips
2nd Lot: +83 pips
Total: +113 pips

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June 4, 2009 3:45 pm (Manila)

1st lot is out at +30 pips. Moving stop of 2nd lot to breakeven to make trade risk-free.

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June 4, 2009 3:30 pm (Manila)

BUY GBP/USD @ 1.6339
Stop - 1.6195
Limit 1 - 1.6369
Limit 2 - 1.6422

In about a half hour or so, UK HPI data comes out which should be positive for the Pound. HPI (Housing Prices Index) is a leading indicator of economic health. When housing prices go up, it's a sign that demand is putting a stress on supply. What will happen next is that people who buy houses today (the reason why HPI went up) will buy for furnishings and neccessities on the house, impacting other industries and stressing their own supply situation.

A bounce is seen on the hourly charts which gives me confidence that this pair may be headed on an upward move again.

Also, RSI, MACD and Slow Stochs on the hourly chart support an uptrend.