GBPUSD: Range from 1.2767 to 1.3000 likely to hold
Yesterday’s signals were not triggered, as there was no bearish price action when the resistance level at 1.2876 was 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 1.2767.
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 Idea
Go short following a bearish price action reversal on the H1 time frame immediately upon the next touch of 1.3041.
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 the day’s pivotal point looked like 1.2876, so if the price could get established above that level relatively early during the London session, I would take a cautiously weak bullish bias above that level. It was unable to do so, although that level was invalidated over the course of the day.
The technical picture now shows very weakly bullish short-term price action towards the lower end of a huge price range stretching from 1.2767 to about 1.3000 above.
The British Parliament has voted to hold an election in December, which is likely to finally produce a decisive Brexit outcome. The prospect of some certainty at last on this long-running issue is probably helping the Pound a little.
It looks likely that the price will chop around in the near future, with the only opportunity I can see in this pair being fading a spike to either 1.2767 or the 1.3000 area.
Remember there are some big US data items due later which could create a lot of volatility, so be careful with taking off risk before those items listed below.
There is nothing of high importance due today concerning the GBP. Regarding the USD, there will be releases of ADP Non-Farm Employment Change data at 12:15pm London time, followed by Advance GDP at 12:30pm, and the FOMC Statement / Federal Funds Rate at 6pm then the usual press conference half an hour later.