Last Thursday’s signals were not triggered, as the bullish price action took place some way below the support level identified at 1.3940.
Today’s GBP/USD Signals
Risk 0.75% per trade.
Trades may only be entered between 8am and 5pm London time today.
Short Trade
Go short following a bearish price action reversal on the H1 time frame immediately upon the next touch of 1.4168.
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.
Long Trades
Go long following a bullish price action reversal on the H1 time frame immediately upon the next touch of 1.3879 or 1.3822.
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.
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
My bullish bias last Thursday was not helpful, but my notes that 1.4000 was becoming more resistant and that the price may be due a deeper pull-back were accurate. The price is slowly selling off now within a flag pattern, with the final few hours of last week looking quite bullish with a strong bounce at the low. The British Pound is holding up against the USD much better than the Euro is, which is a bullish sign. A break up above 1.4000 still looks possible, and as there is no resistance beyond that until 1.4168, such a bullish move could be strong if it comes. Below, the support level at 1.3879 looks very healthy, so a bounce there could give a great long trade entry. I still have a bullish bias on this pair, but not a very strong one.
There is nothing due today concerning either the GBP or the USD.