Yesterday’s signals produced a profitable long trade from the bullish bounce at 1.3222 with an engulfing candlestick. It would probably be wise to take either total or partial profit right now.
Today’s GBP/USD Signals
Risk 0.75% per trade.
Trades may only be entered before 5pm London time today.
Long Trade
Long entry following a bullish price action reversal on the H1 time frame immediately upon the next touch of 1.3221.
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
Short entry following a bearish price action reversal on the H1 time frame immediately upon the next touch 1.3344.
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 wrote yesterday that the most high-probability position to take was long, and this worked out fine, with the pair falling to the nearest support and then turning strongly bullish. Technically the position is more bullish now, yet it must be noted that the price has not broken out of its channel, nor has it breached the next obvious key resistance level at 1.3344. This means a short-term bearish pull back is quite likely to happen today, and at the time of writing the bearish turn already seems to be in place. My general bias is bullish, and the pair is established within a long-term bullish trend.
There is nothing important due today concerning the USD. It is a public holiday in the USA. Regarding the GBP, there will be a release of Second Estimate GDP data at 9:30am London time.