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 must be entered between 8am and 5pm London time today only.
Short Trade
Short entry following a bearish price action reversal on the H1 time frame immediately upon the next touch of 1.2918.
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.
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 1.2697 or 1.2618.
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.
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 yesterday that I would take a bullish bias if the price was above 1.2800 at 9am London time. This was a good call, as the price’s failure to rise significantly higher was capped yesterday by an inability to get above that 1.2800 round number level.
The picture now is contradictory: longer-term charts suggest that a downwards trend is about to resume, while the shorter-term charts show a muted but real bullishness marked by the support levels holding, especially the one confluent with the round number at 1.2700.
There is no momentum and we can expect more volatility and shocks in the British Pound as the struggle over Brexit again comes to a head, with a crucial Parliamentary vote now only a few days away. This makes forecasting short-term price movement extremely difficult therefore I have no directional bias here today.
Regarding the GBP, the Governor of the Bank of England will be participating in a minor public discussion at 3:30pm London time. Concerning the USD, there will be a release of the FOMC Meeting Minutes at 7pm London time.