On Thursday May 19, I covereda possible long euro trade where I went long EUR/USD on a tramline break-out (or on the subsequent pull-back).
That trade was taken in the $1.4210 area. My protective stop was moved up to break-even yesterday, following the successful re-test of the break-out tramline.
Again, here is the chart showing the tramline break-out:
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(Click on the chart for a larger version)
Now on Friday May 20, as I write, the euro has made it to my upper tramline:
(Click on the chart for a larger version)
That's where I took profits of over 100 pips. That is a profit of £100 per £1 spread bet.
Remember, this long trade was taken against the backdrop of a huge move down from the May 2 high.
Note that the rally off Monday's low is a tepid affair (compare the choppy rally with the strong impulsivelooking retreat off the high).
That brings up the question: shall I go short here as it has made the upper tramline? I'll discuss the answer to that in the next blog.
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