Nice bucket trade – GBPUSD

GBPUSD offered a great fading opportunity on Wednesday. Where and why?

Where: at 6100
Why? because the level itself and the price action around fulfilled few basic principles of a decent high probable trade (HPT):

1] level of interest – 6100 is a round number, it was tested several times, there is a flip around this level in recent history (flip = support becomes resistance)
2] velocity – the price action around this level has to have some traction, higher speed (means there higher density of orders piled up)
3] extremes – the price is creating extreme swings but overall is symmetrical

Put all these three factors together and you have decent HPT. Check it for yourself and look into the past weeks! There were many other opportunities similar to this.