Last Thursday’s signals were not triggered as unfortunately, the bearish price action took place just a few pips above the resistance level identified at 1.2673.
Today’s GBP/USD Signals
Risk 0.75% per trade.
Trades may only be taken between 8 am and 5 pm London time today.
Short Trades
- Short entry following a bearish price action reversal on the H1 time frame immediately upon the next touch of 1.2676 or the descending trend line which currently sits at about 1.2725 which is shown in the price chart below.
- Put the stop loss 1 pip above the local swing high.
- Move the stop loss to break even once the trade is 25 pips in profit.
- Take off 50% of the position as profit when the price reaches 25 pips in profit and leave the remainder of the position to ride.
Long Trades
- Long entry following a bullish price action reversal on the H1 time frame immediately upon the next touch of 1.2536.
- Put the stop loss 1 pip below the local swing low.
- Move the stop loss to break even once the trade is 25 pips in profit.
- Take off 50% of the position as profit when the price reaches 25 pips in profit and leave the remainder of the position to ride.
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 last Thursday that I would still take a short-term bearish bias here but only once there was a clear failure to rise above key resistance with a strong reversal. This was a good call, as the resistance did cap the day’s high prices followed by a move down, but I was just a few pips out of the exact level.
The Pound has become a little stronger as the Government looks as if it has another month to try to get its Brexit deal before Parliament, by which point MPs may be forced to vote for the deal to avoid a “no deal” scenario.
I remain bearish as the technical signs remain bearish, but a period of consolidation now looks most likely over the short term.
There is nothing important due today concerning either the GBP or the USD.