Last Thursday’s signals were not triggered, as there was insufficiently bullish price action at 1.4043.
Today’s GBP/USD Signals
Risk 0.75% per trade.
Trades may only be taken between 1pm and 5pm London time today.
Short Trade
Go short following a bearish price action reversal on the 1H1 time frame H1H1H1 time frame immediately upon the next touch of 1.4097.
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 Trade
Go long following a bullish price action reversal on the H1 time frame immediately upon the next touch of 1.3983.
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
Last Thursday I wrote that the support level at 1.3983 would probably be key to deciding whether the bears were fully in control. That level has held so far. This could give some encouragement to bulls; however, the action has been generally bearish, and the Pound is starting to look relatively weak after selling off so heavily last week. The price is now consolidating above 1.4000. Trading will be quiet before New York as London is closed. Later, there may be an opportunity to go long from a good bullish bounce at 1.3983. If the price can get established below that level, it would be a strongly bearish sign. I have no directional bias today.
There is nothing due today concerning the GBP – it is a public holiday today in the U.K. Regarding the USD, there will be a release of ISM Manufacturing PMI data at 3pm London time.