Last Tuesday’s signals were not triggered as there was no bearish price action at 1.2850.
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 1.2831 or 1.2772.
- 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 entry into the zone between 1.2910 and 1.2928.
- 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 British Pound has been hit by nervousness that the governing Conservative Party may not achieve a Parliamentary majority in the General Election which will be taking place next week. A new type of opinion poll was just conducting using a new method and a very large sample, and this poll suggested such an outcome. After initially being driven down to the support at 1.2772, a double bottom has formed there, with the price rising again quite strongly yesterday, wiping out the key level at 1.2850. The new crucial resistance looks to begin at 1.2910.
It will be hard to predict the direction of this pair over the next week or so. It is likely to be volatile and driven by news and election opinion polls. There is a lot of news due today, on both sides, which could drive the price anywhere in the short term.
The double bottom at 1.2772 and the likelihood that the Conservatives will win a majority next week makes me believe that long trades are likely to be more productive than short trades.
Concerning the GBP, there will be a release of Manufacturing PMI data at 9:30am London time. Regarding the USD, there will be a release of the ADP Non-Farm Employment Change forecast at 1:15pm, followed by Unemployment Claims at 1:30pm, ISM Manufacturing PMI at 3pm, and Crude Oil Inventories at 4pm.