My previous GBP/USD signal on 10th January gave a profitable long trade from the bullish bounce at $1.2686.
Today’s GBP/USD Signals
- Risk 0.75%.
- Trades must be entered before 5pm London time today only.
Long Trade Ideas
- Long entry following a bullish price action reversal on the 1H1 time frame H1H1H1 timeframe immediately upon the next touch of $1.2687 or $1.2641.
- 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 1H1 time frame H1H1H1 timeframe immediately upon the next touch of $1.2786 or $1.2881.
- 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 almost two weeks ago that the technical picture still looked consolidative, so I expected that the best potential opportunities would be a long scalp from another bounce at $1.2686, followed by a potential short scalp from a short-term reversal at $1.2730.
This was a good call as $1.2686 marked the low of that day.
The technical picture now is looking more bullish as the US weakens as this week gets underway. The price chart above shows about the last 100 hours forming a bullishly ascending linear regression channel, with a succession of higher lows. Moreover, the price action now is bullish with the price threatening to break out of the top of this channel exponentially. There is nothing to stop a rise until about $1.2775 with the precise resistance level identified at $1.2786, so a long trade taking advantage of that would probably be a good opportunity.
There is nothing of high importance scheduled today concerning the GBP or the USD.
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