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GBP/USD Forex Signal - 8 January 2018

By Adam Lemon

Adam Lemon began his role at DailyForex in 2013 when he was brought in as an in-house Chief Analyst. Adam trades Forex, stocks and other instruments in his own account. Adam believes that it is very possible for retail traders/investors to secure a positive return over time provided they limit their risks, follow trends, and persevere through short-term losing streaks – provided only reputable brokerages are used. He has previously worked within financial markets over a 12-year period, including 6 years with Merrill Lynch.

No signals have been given this year yet.

 

Today’s GBP/USD Signals

Risk 0.75% per trade.

Trades must be entered before 5pm London time today only.

 

Long Trades

· Go long following a bullish price action reversal on the H1 time frame immediately upon the next touch of 1.3525 or 1.3456.

· 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 Trade

· Go short following a bearish price action reversal on the H1 time frame immediately upon the next touch of 1.3657.

· Put the stop loss 1 pip above the local swing high.

· Adjust the stop loss to break even once the trade is 20 pips in profit.

· Remove 50% of the position as profit when the price reaches 20 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

This pair is back in a long-term bullish trend, but less strongly than its sister pair EUR/USD is. It is more a case of a weak USD than a strong GBP driving the rise, although as it becomes clearer that the UK is heading towards a very soft Brexit – probably – the Pound does move upwards. The most interesting technical features which can be seen in today’s price chart below is the major lower high, which suggests continued downwards price movement, but it is likely that there is strong support below at 1.3500 or possibly as high as 1.3525. If the price gets established below 1.3500 that would be a bearish sign, but if the area holds up then in line with the bullish trend, the price should turn around and begin to make new highs.
GBPUSD

There is nothing important due today concerning either the GBP or the USD.

Adam Lemon
About Adam Lemon

Adam Lemon began his role at DailyForex in 2013 when he was brought in as an in-house Chief Analyst. Adam trades Forex, stocks and other instruments in his own account. Adam believes that it is very possible for retail traders/investors to secure a positive return over time provided they limit their risks, follow trends, and persevere through short-term losing streaks – provided only reputable brokerages are used. He has previously worked within financial markets over a 12-year period, including 6 years with Merrill Lynch.

 

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