This post is all about planning and building positions prior to a highly anticipated and likely volatile event then shot term trading with the same bias.
Back in early “May” I had begun to front run the UK election with a bias that the GBP would ‘weaken’ from the election not knowing if I’d be on the right side of the trade or not. With that bias I began building short positions in GBP which in looking at these results may seem easy but indeed it was “patience & diligence” in opening trades, getting them positive, and moving stops to “hero or zero” (BE) keeping in mind that with the volatility price could jump 100-200 initially off the election data as it came in so I needed to be ahead with plenty of pips. I wont sit here and say I didn’t lose trades in my attempts nor ignore the fact that I had trades taken out at BE as I built these trades that ‘eventually’ worked out. I know I lost approx 1000(+/-) pips in doing this before the results last night and accepted that risk beforehand! Early this week I had began to exit half positions for profit and lock in remaining profits by moving stops to profit only on the long term trades (those that are 0.05 lots).
When data started coming out at 5 pm NY time the concern was who would win but then became whether or not the conservatives would hold onto a majority of seats in parliament or if there would be a hung parliament or not. With the GBP weakness as the data continued it was time to trade shorter term on the volatility. I had predetermined a role reversal resistance level on the 141.00 psych level for G/J as I had to go to my sons playoff baseball game on the night I had waited for the past month and decided to trade it. This is also an example of scalping in the direction of your longer term bias and decided to scalp this pair. Once back at my station I was able to monitor the exit data as the wait was on for a hung parliament or not that went late into the night. Getting tired after several hours of focusing on the election it was time to exit some trades, move stops on others again, and get some sleep.
In the end I was able to extract over several thousand pips (less some loses) and I still have trades open in hopes price extends further. I know WMD talks about building positions a lot and thought this would be good to share for this type event. I hope you enjoy the post for what its worth, “Do the work and you just might get paid for it” and learn from it in the process as I have!!