This month's ProAct Traders “Pay Your Mortgage Trade” idea is found in the GBPAUD pair.

Elkana’s view on this.

I see, on the daily time frame, the GBPAUD forming an inverted head and shoulder which is a sign of reversal. My first trade will be to continuing to sell this pair (looking for the pole pattern to the downside) until the price hit the 1.7050 area which is a probable bounce and confirmation of the pattern. If that occur, then wait for the formation of the pole before starting to get involve with a buy as the main trend is downwards. If a buy opportunity will show up I will then see the currency starting a 3rd wave up.

The other scenario will be for the pair to carry on with the downwards move and negating the inverted head & shoulder which then will ignore the possibility of a buy. If this will happen then we will continue with the sell. I would like to draw your attention to the drawing, especially the grey arrow which the colour represent the uncertainty of the continuation of a sell.

Scott’s view on this.

I see that we have completed 4 waves to the downside and we are poised to do the 5^th wave. If so, my first target is 1,1011 pips away and in order to be a 5^th wave it has to go further than that. I am looking for an even deeper move which could be an additional 606 Pips

How to trade it? You will need to wait for your set-up to show up, for London & New York traders, that will mean waiting for the formation of the rectangular pattern (pole trade and a break hook and go) and use the respective risk reward ratio to start trading this currency pair. Wait for Rallies to add to this position. Remember the “ pullback is your friend” in route so use those to add to the position. Currently the ATR (Average True Range) of the currency is 157 Pips per day, so this might not take long!

Our trading methodology is based on proprietary technical indicators. We pay attention to what the big banks are doing in the markets (the Big Boys) and specifically look for opportunities that have a high opportunity and low risk. We always identify our target before entering a trade, and we focus on the risk of the trade instead of the reward. We have (and follow) rules, and we press our winning trades without exception.

Remember that we recommend that you always trade with stops. And if you don't trust yourself or think you'll get cold feet in a long trade like this, then place the trade and walk away. Better to get taken out by a stop or target than to second guess an active trade and take yourself out. Do your research before you place your own trade. Trust your research.

Trading foreign exchange on margin carries a high level of risk, and may not be suitable for all investors. Before deciding to trade foreign exchange you should carefully consider your investment objectives, level of experience and risk appetite. The possibility exists that you could sustain a loss of some or all of your initial investment and therefore you should not invest money that you cannot afford to lose. You should be aware of all the risks associated with foreign exchange trading and seek advice from an independent financial advisor if you have any doubts.