Yesterday’s signals were not triggered, as the bearish price action at 1.3217 did not happen until after 5pm London time.
Today’s GBP/USD Signals
Risk 0.75% per trade.
Trades may only be entered before 5pm London time today.
Short Trade
Short entry following a bearish price action reversal on the H1 time frame immediately upon the next touch of 1.3217.
Place 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
Long entry following a bullish price action reversal on the H1 time frame immediately upon the next touch of 1.3030.
Place 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 it was quite likely there would be only minor movements today during the London session, with the market looking to the major FOMC releases tonight which should bring more volatility and possibly direction. This is what happened, after the price turned bearish right to the pip at the resistance level I identified at 1.3217. The picture is now more bearish in line with the general recovery by the USD in recent hours and the weakness in riskier currencies such as the British Pound. It is useful to compare what is going on here with the EUR/USD currency pair which is more bearish – the movements in this pair GBP/USD are less predictable as there is a Brexit wild card in the value of the British Pound. I think it will be more useful to trade the EUR/USD today than this pair.
Regarding the USD, there will be releases of Core Durable Goods Orders and Final GDP data at 1:30pm London time. There is nothing due today concerning the GBP.