Yesterday’s signals were not triggered, as the price was already above the resistance level of 1.2851 by the time London opened.
Today’s GBP/USD Signals
Risk 0.75% per trade.
Trades may only be entered 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 1.2975.
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 1.2920 or 1.2858.
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
I wrote yesterday that there was a good long-term bearish trend here, but the price may not be ready to fall further. I would want to see the price firmly below 1.2951 at 9am London time and moving down over the short-term before taking a bearish bias today. I was correct to be cautious as the price did pop up around the London open above that level before falling back again, with the low of the day coming just a few pips above the next support level at 1.2920. As can be seen from the zoomed-out price chart below, the British Pound has been very bearish over the long-term and continues to look relatively weak. Generally, looking for short trades here will probably be a wise course of action. If the price falls below 1.2920 and remains there for the first couple of hours of the London session, I would take a bearish bias. Another alternative for a short trade would be a failed test of 1.2975, but that does not look very likely to happen today.
There is nothing important due today concerning the GBP. Regarding the USD, there will be a release of Crude Oil Inventories data at 3:30pm London time.