GBPUSD: Weak bullish recovery from below 1.2500
Last Thursday’s signals were not triggered as there was no bearish price action at either 1.2540 or 1.2562.
Today’s GBP/USD Signals
Risk 0.75% per trade.
Trades must be taken before 5pm London time today only.
Long Trade Ideas
Long entry following a bullish price action reversal on the H1 time frame immediately upon the next touch of 1.2550, 1.2515, or 1.2495.
Place 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.
Short Trade Ideas
Short entry following a bearish price action reversal on the H1 time frame immediately upon the next touch of 1.2587, 1.2615, or 1.2659.
Place 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 20 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 still saw the best potential set-ups as short trades, but this may take a while to happen. I had no short-term directional bias.
This was a little wrong, as the price has continued to firm up and slowly move higher over the past few days, mainly due to Dollar weakness.
Both the Pound and the U.S. Dollar are relatively weak currencies, meaning this is probably not going to be the right currency pair to trade right now. If you must trade it, look for scalps off rejections of key levels for small, conservative profits, in either direction.
There is nothing of high importance due today regarding either the GBP or the USD.