Equilon FXThis article preserves the desk’s published view at that time. Prices, market assumptions and trade status are historical statements, not current guidance or independently verified performance.
Cable is back at 1.27 for the third time in two months. We've faded it twice. Both times it worked. Here's the third attempt — and the rules under which we don't take it.
The level history
- First test: Feb 28. Faded short from 1.2710. Closed at 1.2620 for +2.2R.
- Second test: March 25. Faded short from 1.2705. Closed at 1.2640 for +1.6R.
- Third test: Today. Price tagging 1.2715 on the back of soft UK CPI.
The trade
Why the third fade is the most dangerous
This is the trade where most retail traders get blown out. "It's worked twice, this time it'll definitely work" is survivorship bias talking, not edge. The market knows where the obvious stops are. It loves to run them on the third visit before the move you actually wanted.
We're taking it because:
- The setup is structurally identical to the previous two — same rejection wick on the 4H, same macro context, same volume profile
- R:R is 2.3 — even with one loss in the next two attempts, expectancy stays positive
- Most importantly: we have a hard kill rule below
When we walk away
If this trade gets stopped, we don't take a fourth. The level has been arbitraged out. Three taps with a failure on the third is the market telling us it wants to break, not bounce. We listen and rotate to the breakout play (long above 1.2745) instead.
The rule is simple: the chart is allowed to change its mind, and so are we.
Educational only. Not investment advice. Read the full risk disclaimer.