My previous GBP/USD signal on 29th February produced 20 pips of profit on the short trade entry rejecting the resistance level I identified at $1.2670.
Today’s GBP/USD Signals
- Risk 0.75%.
- Trades may only be entered between 8am and 5pm London time today.
Long Trade Ideas
- Go long following a bullish price action reversal on the H1 timeframe immediately upon the next touch of $1.2839, $1.2820, or $1.2786.
- 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 Ideas
- Go short following a bearish price action reversal on the H1 timeframe immediately upon the next touch of $1.2881, $1.2905, or $1.2966.
- 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 forecast for the GBP/USD currency pair that the technical picture consolidative below $1.2715. However, there were starting to be more bearish developments, and I thought that the new resistance level at $1.2670 looked likely to provide a good short trade entry if it was reached again.
This was a good and accurate call.
Almost two weeks later, the technical picture has become much more bullish, we have really seen quite a turnaround. There is renewed weakness in the US Dollar, which is back in a long-term bearish trend. Last week the price made a bullish breakout beyond $1.2715 which had acted as strong resistance for a long time. This bullish breakout then followed through on Friday, although there was some profit taking at the end of the day. The price is now not far from its 7-month high.
We see new higher support levels below the price with the nearest level at $1.2839.
The price is making a short-term consolidation above that level, and the price action looks bullish.
We seem likely to get another rise in price today, so a long trade from any bullish bounce off the nearest support level at $1.2839 is probably the opportunity to watch out for today, with the Pound one of the relatively strongest major currencies against the greenback.
There is nothing of high importance scheduled today concerning either the GBP or the USD.
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