Yesterday’s signals were not triggered, as there was no bullish price action at 1.4297.
Today’s GBP/USD Signals
Risk 0.75% per trade.
Trades may only be taken before 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 1.4435.
* Place the stop loss 1 pip above the local swing high.
* 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.
Long Trades
* Go long following a bullish price action reversal on the H1 time frame immediately upon the next touch of 1.4297 or 1.4221.
* 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 took a very bullish bias yesterday, as the price was making new long-term high prices with strong bullish momentum. The price did rise higher as London opened, but then fell quite strongly upon a release of worse than expected British average earnings data. Despite this, there are two bullish factors that are worth noting: an earlier swing high at about 1.4285 has held, and the pull-back does not break the general rhythm of the upwards movement over recent days, which can be seen in the price chart below. Due to these factors and the long-term bullish trend, I would still take a bullish bias, but I note there will be a release of British inflation data shortly, which could strongly affect the price and will overpower technical factors if the number is off from consensus expectations.
Concerning the GBP, there will be a release of CPI data at 9:30am London time. Regarding the USD, there will be a release of Crude Oil Inventories data at 3:30pm.