GBPUSD: Very bearish
Last Thursday’s signals were not triggered, as none of the key levels were reached that day.
Today’s GBP/USD Signals
Risk 0.75% per trade.
Trades must be taken before 5pm London time today only.
Long Trade Idea
Long entry upon the next touch of 1.2280.
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 1.2393 or 1.2424.
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 until the Brexit issue becomes clearer, it looked as if this currency pair would consolidate within the triangle shown in the previous price chart. I thought the direction looked unclear now so I would stand aside until we got a break of this triangle in one direction or the other.
This was a good call as the triangle broke down, although not until Friday so it was too late for this signal, but after breaking down the price fell further to close at a 2-year weekly low close, which is a bearish sign.
The European Union is sending negative signals on the prospect of renegotiating the Brexit deal which has helped the Pound to fall. The British Pound now looks very weak. The price is now being held up by support at 1.2364 but if that breaks and the price is below 1.2350 at 9am or 10am London time today, I would take a bearish bias on this currency pair for the day.
There is nothing of high importance due today regarding either the GBP or the USD.