Last Wednesday’s GBP/USD signal produced a losing short trade from the bearish reversal at 1.3760.
Today’s GBP/USD Signals
Risk 0.75%.
Trades may only be entered between 8am and 5pm London time today.
Short Trade Ideas
Short entry following a bearish price action reversal on the H1 time frame immediately upon the next touch of 1.3898 or 1.3950.
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
Long entry following a bullish price action reversal on the H1 time frame immediately upon the next touch of 1.3808 or 1.3766.
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 the price had started to move in cleaner swings, but the medium or long-term direction was still unclear. I thought that the nearby resistance levels looked stronger than the support levels on the other side, but this was neither an accurate nor profitable call.
Last week, especially the last few days of the week following my previous signal, saw most currencies advance firmly against the USD. The GBP was no exception but the rise in the pound was much weaker than in many other currencies, which shows that there is not much strength in the pound right now.
The price may have just printed new flipped support at 1.3843, but if this level does not become meaningful and the price breaks back down through it, the price could hit the support level at 1.3808 which looks likely to be strong.
I think the best potential set up which might give an opportunity today will be a long trade from 1.3808 if there is a bullish bounce there, but this is unlikely to happen during the first half of the London session, and as the USA is on holiday, markets are likely to go very flat once we reach about 1pm London time.
There may well be better opportunities today in other currency pairs.
There is nothing of high importance scheduled today concerning either the GBP or the USD. It is a public holiday today in the USA.