GBPUSD: Consolidating on Brexit uncertainty
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 must be entered before 5pm London time today.
Long Trade Idea
Long entry following a bullish price action reversal on the H1 time frame immediately upon the next touch of 1.2767 or 1.2697.
Put 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 Idea
Short entry following a bearish price action reversal on the H1 time frame immediately upon the next touch of 1.3041 or 1.3081.
Put 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 we were not close to either clear-cut support or resistance. I took no directional bias on this pair. This was an OK call as the price has not gone anywhere.
The price will continue to be driven primarily by the Brexit extension situation, with no answer to that due until Friday. It also seems the British government is not sure what to do regarding its own Brexit / election strategy. The price remains a long way from either support or resistance and is going nowhere. It may well be that today’s action is driven by the ECB’s policy release driving the Euro which will have a knock-on effect on the Pound, so today’s action looks very unpredictable. Therefore, the best strategy may be fading a spike to a key level at an extreme following the ECB release, but this would probably work better in EUR/USD.
There is nothing of high importance due today concerning either the GBP or the USD.