GBP strength

Would someone explain to me the vigorous strength of BGP against the USD for the last 24 hours while EUR and JPY are losing strength USD.There is no sign of GBP taking a dip- it goes down a little but bounces back for new highs.
I am losing heavily since I sold it.

Up until Oct 14 the pound was one of the worst performers and was not benefiting from the dollar weakness. This was primarily because of the weak economic data out of the U.K causing some ppl to compare their economic recovery to be as sluggish and slow as the U.S. recovery. U.K inflation data came out lower than expected which means the Bank of England is no hurry to raise interest rates anytime soon.

Bottom line is that the market's perceptions during the Oct 8- 13th Gbp/usd drop was that the U.K economy was in the same boat as the U.S. economy. This also caused the dramatic rise in Eur/gbp.

Eventually some profit taking kicked in on gbp/usd, combined with general dollar weakness this caused the GBP to catch up to all the dollar selling that was happening. Stops were tripped at various levels all the way up further exacerbating the move. Eur/gbp also decided to correct in a hurry further adding buying pressure to the pound.

So in summary:

1. Significant dollar weakness led to some GBP buying pressure
2. Profit taking on gbp/usd shorts led to buying pressure
3. Stops were tripped on the way up in gbp/usd
4. Eur/gbp dropped like a rock causing people to bid up the pound a lot more than they usually would have in the weak dollar environment.

Hope it helps.

Thanks a lot for taking the time and explaining the issue in such detail. I am a beginner in forex and started trading currency futures rather than forex.
Can you give me the "chrystal Ball" reading or your own insight if GBP would come back to where it started the sudden uptrend. I see it now making new highs everyt ime it comes down a little.
I hate to buy back with such a loss and can hold the position for some more time.
Appreciate your kind help
Best Regards

From a technical POV, and this is my POV which could at anytime change (because Im just that flexible) there was a huge run down which eventually would lead to profit taking. At a point when the profits where taken the run down was just that big that there was room to the upside for buying. We are now coming close to the 6400 mark which is also where I have my decending Trendline which could be a roof for more profit taking and subsequent selling off.

These happen all the time, the market runs to good distance and opens opportunities for the other side. Now if the market continues its run past 6400-6500 then I would be happy to wait for a pullback and buy on good price action (my flexibility). Sometimes fundamentals mean nothing in the short frame and in the end the big boys controlling price are just out there to make money, being on the same wavelength as them will put you in the same basket, lined with $100 bills .

Razor

Chart shows the decending TL. If it breaks then we can look for a pullback, if it holds then we may just be at the top of the rollercoaster ready to head back down. Time will tell

gbp strenght definitely, 4 weeks high

don't be upset at it, you got it wrong..... manage your risk let hit stop, move on and look for your next winner. no need to ask why just realize that you got it wrong this time.

All of these theories may be correct or they could all be crap. Either way, knowing why the market moved against you won't help. The bigger question is why you didn't have the discipline to cut your position before you lost heavily. You can waste the next year or two thinking you can "learn" the market or you spend a week learning money management. Don't feel bad if you chose the former...most do.

Thanks a lot everybody for the advice-(which I needed) and for plain talking (which I deserved).
I did have a stop loss for the short sell- earlier during the hour I hit two/three stop lossses only to "resume" the short sell.

When another stop loss came, I cancelled it; hoping it would be like the previous ones and went to bed withoiut a stop loss- I can kick myself only for doing a foolish thing which I seldom do.

I am in US Central Time. Come Sunday evening I shall close the position. Is it better to close the position during:
a. London Market Hours, or
b. New York Market Hours

I have been trading equities, ETFs, Options for a long time. This Forex and Futures market is very fast moving- but it presents better returns or a kick for a foolish move.

Thanks a Lot EveryOne

If you have a position still opening then it is obvious that you have learnt nothing. You had plenty of time to cut the loss from a stupid move and minimise the damage and now, from what it sounds like, you are going to wait (you have too now anyway) for trade to resume on sunday just to close it.

WHY NOT YESTERDAY??????