Instrument: GBPCAD
Trade Type: Long
Timeframe: 4HR
Entry price: 1.78412
Stop Loss (SL): 1.77888
Take Profit (TP): 1.82181
Risk-Reward Ratio:
Outcome:
Entry/Analysis
On February 14, 2025, I executed a long position on the GBPCAD pair, building upon the bullish momentum observed after the price surpassed the 200-day exponential moving average (EMA) the previous day. This upward movement followed a significant sell-off against the pound, leading me to anticipate a continued bullish trajectory targeting previous daily highs. The formation of a new support zone, coupled with multiple rejections off the 200 EMA, reinforced my confidence in the potential for further upward movement. Additionally, the prevailing market sentiment indicated that approximately 20% of retail traders were positioned long, suggesting a contrarian opportunity to capitalize on the anticipated bullish continuation.
Today's market developments further validated my analysis. The Bank of England's recent decision to reduce the Bank Rate by 0.25 percentage points to 4.5% on February 5, 2025, has had a stabilizing effect on the pound. Despite global uncertainties and domestic fiscal challenges, the GBP has remained relatively stable, with the annualized standard deviation of daily returns at its lowest in 35 years. This period of reduced volatility under Prime Minister Keir Starmer's leadership has provided a conducive environment for my long position on GBPCAD. As the trade progresses, I plan to implement a trailing stop-loss strategy, adjusting it as each target is reached, to protect profits while allowing for potential further gains.
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