GBP/USD: Pound is less weak than most risky currencies
Last Thursday’s signals were not triggered.
Today’s GBP/USD Signals
Risk 0.75% per trade.
Trades may only be entered before 5pm London time today.
Short Trade Idea
Go short following a bearish price action reversal on the H1 time frame immediately upon the next touch of 1.3100 or 1.3194.
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.
Long Trade Ideas
Go long following a bearish price action reversal on the H1 time frame immediately upon the next touch of 1.3037 or 1.3022.
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 last Thursday that if the support at 1.3119 or at least 1.3094 held, the price should rise by the New York close, so I was ready take a bullish bias. However, these levels did not hold, and the price broke below them, so I was wrong.
We are in a risk-off environment now which would typically make this pair bearish. However, although the price has come down, and is rejecting the lower resistance level at 1.3080, it does not look likely to fall much further. Therefore, I would avoid trading this pair today and wait until risk sentiment improves when it should become a good buy.
Brexit will be happening on Friday night, which may have some symbolic impact upon the price.
There is nothing of high importance due today concerning either the GBP or the USD.