My previous GBP/USD signal on 27th November was not triggered as the bearish price action took place slightly above the resistance level which I had identified at $1.2635.
Today’s GBP/USD Signals
Risk 0.75%.
Trades must be taken between 8am and 5pm London time today only.
Long Trade Ideas
- Long entry following a bullish price action reversal on the H1 timeframe immediately upon the next touch of $1.2571 or $1.2545.
- Place the stop loss 1 pip below the local swing low.
- Move the stop loss to break even once the trade is 25 pips in profit.
- Remove 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 Ideas
- Short entry following a bearish price action reversal on the H1 timeframe immediately upon the next touch of $1.2617, $1.2653, or $1.2688.
- Place the stop loss 1 pip above the local swing high.
- Move the stop loss to break even once the trade is 25 pips in profit.
- Remove 50% of the position as profit when the price reaches 25 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 in my previous forecast for the GBP/USD currency pair on Monday last week that higher prices were most likely today but it may be quiet. I was looking for a long trade from $1.2587, but this level was not reached.
I was correct about it being an up day.
The technical picture now has become somewhat more bearish after the price has fallen over recent days as the US Dollar has gained ground. The price chart below shows the price is moving down in stairstep bearish swings, printing new lower resistance levels. However, it is worth noting that this movement is not especially strong, and that the price is only back to where it was last week.
Concerning support and resistance, the resistance level confluent with $1.2650 looks especially pivotal and likely to hold, so a short scalp from that area if reached today could be a nice trade. The lower resistance at $1.2617 looks much less strong.
Looking at the nearby support, if the price breaks below $1.2571, it has a long way to fall, so might reach $1.2500 quite quickly. Two lower consecutive hourly closes before the New York session starts could be a good signal to enter a new short trade.
There is nothing of high importance scheduled today concerning either the GBP or the USD.
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