Last Monday’s GBP/USD signals were not triggered, as none of the key support or resistance levels were reached that day.
Today’s GBP/USD Signals
Risk 0.75%.
Trades must be entered between 8am and 5pm London time today only.
Short Trade Ideas
Go short following a bearish price action reversal on the H1 time frame immediately upon the next touch of 1.3759 or 1.3822.
Place the stop loss 1 pip above the local swing high.
Move the stop loss to break even once the trade is 20 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 ride.
Long Trade Ideas
Go long following a bullish price action reversal on the H1 time frame immediately upon the next touch of 1.3617, 1.3588, 1.3560, or 1.3527.
Place the stop loss 1 pip below the local swing low.
Move the stop loss to break even once the trade is 20 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 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 Monday that we were seeing a pressured consolidation ready for a bullish breakout beyond 1.3759. I was ready to buy the breakout and I was also looking to go long at 1.3617 even if the breakout did not happen or if it failed.
In one sense I was wrong, as the resistance level at 1.3759 held with the high of the day being only 1 pip below it. In another sense I was correct, at least in terms of what happened yesterday, as the price made a bullish bounce at the support level of 1.3617 just as I had anticipated.
It is very clear looking at the price chart below that this currency pair is moving in a wide, evenly balanced consolidation between the support at 1.3617 and the resistance at 1.3759. This pair and the Forex market are quite evenly balanced right now, so I take no real bias either long or short, although there is a long-term bullish trend and relative strength in the British pound even though the dollar has been gaining some ground this week.
I am happy to take either a long trade from another bounce at 1.3617 or a short trade from a bearish reversal which may set up again at 1.3759.
Regarding the GBP, there will be a release of Final Services PMI data at 9:30am London time. Concerning the USD, there will be a release of the ADP non-farm employment change forecast at 1:15pm.