Yesterday’s signals were not triggered as there was insufficiently bullish price action at the support levels when they were reached.
Today’s GBP/USD Signals
Risk 0.75% per trade.
Trades may only be entered before 5pm London time today.
Long Trades
- Long entry following a bullish price action reversal on the H1 time frame immediately upon the next touch of 1.3344 or 1.3250.
- 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 1.3459.
- 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 correct yesterday in forecasting a further move down. The price has broken below the former support at 1.3344 as I expected and even below the next level at 1.3250 which is also important psychologically. However, there are some initial signs of support in this area, at the time of writing.
The U.S. Dollar is very strong and the British Pound is one of the weaker currencies. Poor British economic data today would likely push the price down even further. A fall below 1.3250 cannot be ruled out, despite the long-term bullish trend still technically in force. I maintain a bearish bias.
Concerning the GBP, there will be a release of Construction PMI data at 9:30am London time. There is nothing due regarding the USD.