1. The GBP/USD pair makes a new range low at least 25 pips (a pip is the forex equivalent of a tick, or minimum price fluctuation) below the opening price after the early Frankfurt/London trading in the GBP/USD rate begins around 1 a.m. ET.
2. The pair then reverses and trades 25 pips or more above the opening price.
3. The pair then reverses once again to trade back below the intraday low established in step 1.
4. Sell a breakout (at least seven pips) below the London low.
5. Once filled, place an initial protective stop no more than 40 pips above the entry price.
6. After the market moves lower by the distance between the entry price and the stop, cover half the position and trail a stop on the remainder.
These simple rules position you to profit from common behavior that can occur in the pound/dollar when the London/European market opens.
2. The pair then reverses and trades 25 pips or more above the opening price.
3. The pair then reverses once again to trade back below the intraday low established in step 1.
4. Sell a breakout (at least seven pips) below the London low.
5. Once filled, place an initial protective stop no more than 40 pips above the entry price.
6. After the market moves lower by the distance between the entry price and the stop, cover half the position and trail a stop on the remainder.
These simple rules position you to profit from common behavior that can occur in the pound/dollar when the London/European market opens.
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