GBPUSD: Still supported at 1.2429
Yesterday’s signals were not triggered as the bullish price action at 1.2429 was not sufficiently strong.
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 1.2429 or 1.2388.
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 1.2500 or 1.2562.
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 yesterday that I would take a bearish bias in this pair if it could get established below 1.2428 later during the day’s London session. This support level held and is still holding, so that was a good enough call to keep out of trouble – I correctly identified the day’s pivotal point.
The U.K. will have a new government later today and analysts will be closely watching the British political scene to determine whether it will have a better chance of delivering Brexit in October and how likely it will be to be able to agree a deal with the European Union. Sentiment on these issues should be able to push the Pound around and the price is likely to hold steady until the New York session later when there will probably be more movement. The new Prime Minister is expected to formally take office at about 3pm London time.
I would hold off from looking for any trades here except perhaps a short from a failure to break above 1.2500.
There is nothing of high importance due today regarding either the USD or the GBP.