My previous GBP/USD signal on 25th November was not triggered, as the bearish price action took place above the resistance level which I had identified that day.
Today’s GBP/USD Signals
Risk 0.75%.
Trades can only be entered before 5pm London time Thursday.
Long Trade Ideas
- Go long following a bullish price action reversal on the H1 timeframe immediately upon the next touch of $1.2650, $1.2619, or $1.2609.
- Put the stop loss 1 pip below the local swing low.
- 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 run.
Short Trade Idea
- Go short following a bearish price action reversal on the H1 timeframe immediately upon the next touch of $1.2720.
- 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 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 in my previous GBP/USD forecast at the start of this week that the best opportunity looked likely to be from a bullish breakout beyond $1.2603 during the first half of the day’s London session. This was a good call in the sense that the price quickly retreated from that area when it was tested, so it was a pivotal point worth watching.
The last two days have seen the US Dollar give up some of its recent gains and decline quite firmly, after it reached a near 2-year high price just a few days ago. The question now is whether the long-term bullish trend in the US Dollar will resume, meaning the directional bias here would be short.
The best chance which might set up today would be a short-term long trade from a bullish bounce at the support at $1.2650, which is confluent with a half-number. However, the price may already be turning bullish after reaching to within just a few pips of that level.
Any trades here should be taken early, as due to the public holiday in the USA, there will likely be very thin liquidity later towards the last few hours of the London session today.
There is nothing of high importance due today concerning either the GBP or the USD. It is a public holiday today in the USA.
Ready to trade our free Forex signals? Here is our list of the best Forex brokers for beginners worth reviewing.