GBP/USD Signal Update
Yesterday’s signals expired without being triggered. The price did reach 1.6884 which acted as resistance, but this happened too late in the London session to trigger the short trade signal.
Today’s GBP/USD Signal
Risk 0.75%
Entries may be made only between 8am and 5pm London time today.
Long Trade 1
Go long at the first touch of 1.6750.
Place a stop loss at 1.6710.
Move the stop loss to break even when the price reaches 1.6800.
Remove 50% of the position as profit at 1.6820 and half of the remainder of the position at 1.6880.
GBP/USD Analysis
Yesterday I predicted that “the price has been forming a narrowing triangle this week from which it needs to break out. It will almost certainly take the USD data due later today to effect this, probably the FOMC statement due this evening after the London close.” The forecast was correct although we had the breakout after the first round of data and the breakout was bullish, with resistance kicking in temporarily at the 1.6884 resistance level I had identified.
As I have been saying every day for a while now, everything about this pair is bullish. At the time of writing we are pushing up above the 1.6884 level, and of course we made a new 5-year high yesterday. We do not have any obvious resistance levels before the key psychological level of 1.7000. A little way above there, we have an interesting flipped support to resistance zone from 1.7041 to 1.7047 which could be an interesting area.
There are not really any obvious levels at which to go long before 1.6750 which we are very unlikely to get back to any time soon. Day traders could look for a pull back to somewhere close to the small triangle we broke out of at around 1.6830 as an area to try to get long again, with 1.6884 being an obvious place to take some profit.
There is plenty of news today and if it is all bullish for this pair we may just keep going up.
There will be a release of UK Manufacturing PMI data at 9:30am London time that could affect the GBP. Regarding the USD, at 1:30pm the Chair of the Fed is speaking and there will be a release of Unemployment Claims data. Later at 3pm there will be a release of ISM manufacturing data. Although we have the non-farm payroll data due tomorrow it is likely to be an active day for this pair.