Yesterday’s signals were not triggered, as there was no bullish price action at 1.2894.
Today’s GBP/USD Signals
Risk 0.75% per trade.
Trades must be taken between 8am and 5pm London time today only.
Short Trade
Go short following a bearish price action reversal on the H1 time frame immediately upon the next touch of 1.2894.
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 Trades
Go long following a bullish price action reversal on the H1 time frame immediately upon the next touch of 1.2834, 1.2820, or 1.2780.
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 as the situation looked more bearish, if 1.2934 held as new resistance, I saw the price as likely to fall further, but probably not by a lot as trading is likely to be thin, and due to the several support levels nearby.
This was a great call as the level held, and the price fell but only to the nearest support level of 1.2859, which was not exceeded by more than 4 pips.
The situation still looks bearish, but it is worth being cautious as there are two key support levels close to the current price, and we have major data for both currencies arriving later today which could push the price anywhere, with volatility.
I have no directional bias today but would be happier taking short trades than long trades in this currency pair.
Regarding the GBP, there will be an Inflation Report Hearing at 1:15pm London time. Regarding the USD, there will be a release of ISM Manufacturing PMI data at 3pm.