GBP/USD Forex Signal - 20 October 2015

GBP/USD Signals Update

Yesterday’s signals expired without being triggered as neither of the key levels were reached.

Today’s GBP/USD Signals

Risk 0.75% per trade.

Trades must be taken before 5pm London time today only.

 

Long Trade 1

  • Go long following a bullish price action reversal on the H1 time frame immediately upon the next touch of 1.5381.

  • Place 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 trade is 25 pips in profit and leave the remainder of the position to ride.

 

Short Trade 1

  • Go short following a bearish price action reversal on the H1 time frame immediately upon the next touch 1.5557.

  • Place 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.

 

Short Trade 2

  • Go short following a bearish price action reversal on the H1 time frame immediately upon the next touch 1.5655.

  • Place 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.

GBP/USD Analysis

I was dubious yesterday about the resistance at 1.5485 being able to hold, even with the confluent bearish trend line, and this outlook has been proven correct. We can now disregard that level and trend line and look instead to the next resistance at 1.5557 as a probable target. This is a bullish development. It looks like the USD is naturally weakening today and if that is confirmed by news then we could see the price reach that next resistance level.

The support below at 1.5381 remains valid and there is a new supportive trend line below that.

GBPUSD

Concerning the GBP, the Governor of the Bank of England will be testifying before the British Parliament at 11am London time. Regarding the USD, there will be a release of Building Permits data at 1:30pm.

Adam Lemon

Adam Lemon began his role at DailyForex in 2013 when he was brought in as an in-house Chief Analyst. Adam trades Forex, stocks and other instruments in his own account. Adam believes that it is very possible for retail traders/investors to secure a positive return over time provided they limit their risks, follow trends, and persevere through short-term losing streaks – provided only reputable brokerages are used. He has previously worked within financial markets over a 12-year period, including 6 years with Merrill Lynch.