Yesterday’s signals were not triggered, as none of the key levels were ever reached.
Today’s GBP/USD Signals
Risk 0.75% per trade.
Trades may be taken until 5pm London time today only.
Short Trades
- Short entry following a bearish price action reversal on the H1 time frame immediately upon the next touch of 1.2778 or the trend line currently sitting at about 1.2818.
- 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
- Long entry following a bullish price action reversal on the H1 time frame immediately upon the next touch of 1.2616.
- 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 the outlook looked bleak for the Pound. Technically, we were seeing a breakdown of the consolidating triangle and a solid fall in this late Asian session, so I took a bearish bias. This worked out well as the price continued to fall, ending the London session close to 1.2725. There has been a recovery, but the technical picture remains bearish as long as the descending trend line holds. If the resistance at 1.2778 holds that will create an even more bearish outlook. The only reason to doubt further falls would be if the U.S. data later was unexpectedly weak.
There is nothing important due today concerning the GBP. Regarding the USD, there will be a release of CB Consumer Confidence data at 3pm London time.