Yesterday’s signals were not triggered as although the price rejected the anticipated resistance level at 1.3240, the price action was insufficiently bearish to justify an entry.
Today’s GBP/USD Signals
Risk 0.75% per trade.
Trades may only be entered between 8am and 5pm London time today.
Long Trade 1
- Long entry following a bullish price action reversal on the H1 time frame immediately upon the next touch of 1.3167.
- Place 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 Trades
- Short entry following a bearish price action reversal on the H1 time frame immediately upon the next touch of 1.3240, 1.3304, or 1.3344.
- Place 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
Like the EUR/USD currency pair with which it is highly positively correlated, this pair is in a strongly bullish trend. This pair was the strongest mover in the Forex market last week, which suggests continued strong momentum is likely this week. Although higher prices look most likely, the EUR/USD looks stronger than this pair, as it faces resistance at 1.3240 which has already held. If this level is not broken today or later this week, a downwards movement to at least 1.3100 will become likely.
Concerning the GBP, there will be a release of Construction 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 Crude Oil Inventories at 3pm.