GBPUSD: Ranging between 1.3062 and 1.3143
Yesterday’s signals were not triggered, as there was no bearish price action when the price first reached 1.3136.
Today’s GBP/USD Signals
Risk 0.75% per trade.
Trades may only be entered 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 1.3062.
Put 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 1.3143, 1.3175, or 1.3235.
Put 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 could get established above the resistance level at 1.3136 early in today’s London session, it would be likely to rise further and have an up day. This was a good call as the price struggled to get established above that level and then failed to rise significantly during the day, so it was enough to keep anyone out of trouble.
The real strength is in the Euro, which is dragging up the Pound as a knock-on effect.
Although there is still good reason to be bearish on the USD and bullish on the Euro and some other assets, the Pound now seems to be calming down and going out of focus.
We are likely to see the price range now between 1.3062 and 1.3143. This means traders would be wise here to look for reversal entries off either level.
There will probably be better opportunities elsewhere in the market today.
There is nothing of high importance due today regarding the GBP. Concerning the USD, there will be a release of CB Consumer Confidence data at 3pm London time.