False Spikes. GBPUSD (20 Mar 09).

GBPUSD was happily trading in a range for 10 5min Candlesticks. We can see the consolidation pattern in the second picture above.


Prelude:
Base on 30min trend, Stochastics and MACD an entry is setup to short just below the consolidation for 20 pips. Stop loss is 10 pips.


The Trade:
The 1st 5 minute was wonderful as the formation of the candle confirmed my strategy.
The next 5 minute was terrible with pip gains for the previous 5 mins being wipeout.
Seemingly this was a false spike and I exited the trade with approx 6 pips loss.


On Hindsight:
Mkt continued to consolidate for 3 more candles being making the move.
Bang! And this was the real deal, 100 pips for the next 10 candles. The move was clean and clear.
My analysis was correct but the follow-through lacking.

Dear readers,
what is your lesson for this trade?