Last Thursday’s signals were not triggered, as there was no price action suitable to trigger a trade entry signal when any of the support or resistance levels were reached.
Today’s GBP/USD Signals
Risk 0.75% per trade.
Trades may only be entered between 8 am and 5 pm London time today.
Short Trade Ideas
- Go short following a bearish price action reversal on the H1 time frame immediately upon the next touch of 1.2975, 1.2993, or 1.3079.
- 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.
- 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.
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 the best option would be to trade reversals from extremes of the price while being ready to make fast exits from any trades which should be closely monitored.
The price area around 1.3000 looked very clearly like a place to avoid any new trades.
This was a good call as the price movement continued to be one of ranging and swinging from one relative extreme to the other, with the 1.3000 area in the middle, so it was definitely a good move to avoid trading that area.
The technical picture remains broadly the same, with the Pound gaining on the U.S. Dollar over the short-term. However, the 1.3000 level now stands out as a potentially pivotal point, maybe even for a short trade entry later today. If the price can get established above 1.3000 that will be a moderately bullish sign.
Volatility remains relatively high, meaning this currency pair will tend to give the most price movement of any of the major Forex pairs.
I see the very best opportunity which might set up later today as a short trade from a bearish reversal at 1.3079.
There is nothing of high importance due today regarding the GBP. Concerning the USD, the Chair of the Federal Reserve will be giving a minor speech at 1 pm London time.