Yesterday’s signals were not triggered as none of the key levels were ever reached.
Today’s GBP/USD Signals
Risk 0.75% per trade.
Trades must be taken before 5pm London time today only.
Long Trades
- Long entry following a bullish price action reversal on the H1 time frame immediately upon the next touch of 1.2900 or 1.2850.
- Put the stop loss 1 pip below the local swing low.
- Move the stop loss to break even once the trade is 25 pips in profit.
- Take off 50% of the position as profit when the price reaches 25 pips in profit and leave the remainder of the position to ride.
Short Trade 1
- Short entry following a bearish price action reversal on the H1 time frame immediately upon the next touch of 1.3000.
- Put the stop loss 1 pip above the local swing high.
- Move the stop loss to break even once the trade is 25 pips in profit.
- Take off 50% of the position as profit when the price reaches 25 pips in profit and leave the remainder of the position to ride.
The best method to identify a classic “price action reversal” is for an hourly candle to close, such as a pin bar, a doji, an outside or even just an engulfing candle with a higher close. You can exploit these levels or zones by watching the price action that occurs at the given levels.
GBP/USD Analysis
The price failed again at the recent swing high, which was not a surprise as the 1.3000 area is strong resistance, and additionally, the British Pound awaits its Monetary Policy Report today – it tends to consolidate ahead of this big announcement. The result of the report could have a heavy impact, although it would be a huge surprise if the committee voted to raise the interest rate. If more than 1 member votes to raise rates, or if language in the Report sees the economy heating more rapidly, then it would be bullish for the Pound.
Should the area at 1.3000 fail again after the report, a sharper bearish correction would be likely to begin, breaking 1.2900 and reaching to at least 1.2850. Despite that, the 1.2900 area looks like good support, and is confluent with a trend line which could help to keep it firm.
Concerning the GBP, there will be a release of Manufacturing Production data at 9:30am London time, followed by the Bank of England’s Monetary Policy and Inflation Reports, Official Bank Rate and votes at Noon.. Regarding the USD, there will be a release of PPI and Unemployment Claims data at 1:30pm.