GBPUSD: More bearish below 1.2445
Yesterday’s signals were not triggered as none of the key levels were reached.
Today’s GBP/USD Signals
Risk 0.75% per trade.
Trades may only be taken between 8am and 5pm London time today.
Long Trade Idea
Go long following a bullish price action reversal on the H1 time frame immediately upon the next touch of 1.2393.
Place 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.
Remove 50% of the position as profit when the price reaches 25 pips in profit and leave the remainder of the position to run.
Short Trade Ideas
Go short following a bearish price action reversal on the H1 time frame immediately upon the next touch of 1.2445 or 1.2517.
Place 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.
Remove 50% of the position as profit when the price reaches 20 pips in profit and leave the remainder of the position to run.
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 if the price spent some time below 1.2450, especially during the first half of the London session, I thought it will be likely to continue to fall to at least 1.2400. This was a good call, but the price has only fallen as far as 1.2413 so far.
The price is settling now below new lower resistance at 1.2445. As long as the price remains below this resistance, it would make sense to look for a short trade, but the support at 1.2393 could also be firm. For this reason, I would avoid trading this pair today, and hope that the technical picture becomes clearer tomorrow or later in the week.
There is nothing of high importance due today concerning the GBP. Regarding the USD, there will be a release of CB Consumer Confidence data at 3pm London time.