FXWIREPRO: Modifying Strategy in Our Pound/Dollar Bull Call
Anyone who have read through our post “Pound could gain towards 1.5 against Dollar” could easily relate, if not then you have the article here - http://www.econotimes.com/FxWirePro-Pound-could-gain-towards-15-on-weaker-Dollar-178482 .
After a while we have extended our upside target to 1.55 area, if stop loss around 1.38 holds ground in subsequent post - http://www.econotimes.com/FxWirePro-Extending-Pound-Dollar-target-to-155-area-182623
While recent sharp increase in implied volatility almost 3.5% jump in a single day last week and sharp drop in Pound hasn’t hit our stop loss and we continue to remain in favor to our base scenario for the call- a weaker Dollar, a correction that is long due.
As you can see from the above post, our upside target from the buy position is about 1240 pips and risk is about 460 pips, which is pretty large, but with recent increase in volatility we feel, a more cautious short within longer term approach for targets and stop loss will be a much better strategy.
With such view,
We are now adding an interim target where 50% profit booking is recommended, which may be compensated later on with dips buying. Area recommended is 1.467. We would also like to add, interim stop loss around 1.406 area.
The material has been provided by InstaForex Company - www.instaforex.com