Yesterday’s signal was not triggered, as the bullish reversal rejecting the support level identified at 1.3444 did not take place until after 5pm London time.
Today’s GBP/USD Signals
Risk 0.75% per trade.
Trades may only be entered before 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 1.3444.
- 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.
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 have been expecting 1.3444 to be good support and it was finally reached after almost 10 days of ranging, and there has been a small but bullish bounce of the price from this level. The interesting story is that the Pound retains some relative strength against other currencies, as we can see for example the Euro strongly selling off against the Dollar, while the Dollar does not make a great deal of progress against the Pound. This suggests that the long-term upwards trend in this pair is still intact and will take off again sooner or later. As for resistance levels, there are no clear levels in sight, although the 1.3600 area acted effectively as a price cap.
I maintain a bullish bias, but a break below 1.3444 would be a bearish sign.
There is nothing due today concerning the GBP. Regarding the USD, there will be a release of CB Consumer Confidence data at 3pm London time, followed by the Chair of the Federal Reserve speaking at 5:45pm.