Yesterday’s signals were not triggered as there was no bearish price action at 1.2863.
Today’s GBP/USD Signals
Risk 0.75% per trade.
Trades must be taken before 5pm London time today only.
Long Trade 1
- Go long following a bullish price action reversal on the H1 time frame immediately upon the next touch of 1.2863.
- Put the stop loss 1 pip below the local swing low.
- Adjust the stop loss to break even once the trade is 25 pips in profit.
- Remove 50% of the position as profit when the price reaches 25 pips in profit and leave the remainder of the position to run.
Short Trade 1
- Go short following a bearish price action reversal on the H1 time frame immediately upon the next touch of 1.2921.
- Put the stop loss 1 pip above the local swing high.
- Adjust the stop loss to break even once the trade is 25 pips in profit.
- Remove 50% of the position as profit when the price reaches 25 pips in profit and leave the remainder of the position to run.
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
I was wrong yesterday to foresee a continued move down to 1.2756 as the most likely short-term scenario. Instead the price has moved up strongly, and as I write is challenging a confluence of horizontal resistance and a reasonably long-term bearish trend line at about 1.2921. If the price breaks above this level, it will be a bullish sign, but if it fails here, it could provide a great short trade entry opportunity.
There is a weak medium-term bearish trend in this pair, but no more than that, so I do not have much of a bias regarding overall direction.
There is nothing due today concerning the GBP. Regarding the USD, there will be releases of PPI and Unemployment Claims data at 1:30pm London time, followed at 3pm by the testimony of the Chair of the Federal Reserve before Congress.