Last Wednesday’s GBP/USD signals were not triggered, as there was no bearish price action when either of the identified resistance levels were first reached.
Today’s GBP/USD Signals
Risk 0.75%.
Trades may only be taken before 5pm 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 1.3953 or 1.4010.
- 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 1.3860 or 1.3838.
- 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 Wednesday that there was moderate short-term bullish pressure, but we did see both support and resistance levels nearby looking firm and likely to hold. For this reason, I was ready to enter either a long trade from a bounce off the support level at 1.3905, or from a reversal from the resistance level at 1.3966, in each case targeting the other level as a take profit price.
This was an indifferent call as it did not provide a signal. The best that can be said is that it was enough to keep out of trouble.
Today is likely to be a slow day in the Forex market as it is Monday and there is nothing of high or even moderate importance today which is likely to move the market.
Technically, the price has made a weakly bullish turn from the support level at 1.3860, which has continued to hold. This suggests the price may be more likely to rise than fall over the coming hours, but I have little confidence in that as the wider technical picture shows a long-term consolidation below the 1.4000 area. However, you could argue that a rise from the 1.3860 area would be part of this wider consolidation.
The only opportunity I see worth watching out for here today would be a long scalp from any bounce off the support level at 1.3860.
There is nothing of high importance due concerning the GBP or the USD today.