GBP/USD Signal- March 5, 2014

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GBP/USD Signal Update

Yesterday’s signal was not triggered and expired.

Today’s GBP/USD Signal

Risk 0.75%.

• Entry is to be made between 8am and 5pm London time.

Long Trade

• Enter long on the next bar break of any bullish pin or engulfing H1 bar that forms following the first touch today of 1.6620. Following one hour after the close of the first H1 bar to close below 1.6620, the trade is no longer valid.

• Place the stop loss 1 pip below the local swing low.

• Move the stop loss to break even when the trade is in profit by 25 pips or at 1.6675, whichever comes first. Take off 50% of the position as profit, or more if needed to take all the risk off the trade at 1.6675, and let the remainder of the position ride.

GBP/USD Analysis

Yesterday we saw an attempt to rise that could not break 1.6750, before a falling off during the New York session saw the daily candle close as an indecisive doji.

Although the support level at 1.6620 is pretty “used”, the weekly and monthly price action is still strongly bullish, and therefore if confirmed by bullish price action when the price next reaches 1.6620, we might enjoy another good long trade here. It should be noted that the daily price action is bearish and suggestive of an immediate move down.

Alternatively, if the price cuts right through 1.6620, and then goes on to break below last week’s low of 1.6582; this will be a very bearish sign and suggest that we are going to reach 1.6475.

The supportive level at 1.6620 is pretty confluent with today’s daily GMT S1 pivot at 1.6630.

There are no resistance levels appearing strongly reliable above us until1.6870. This price is too far away to be relevant to today’s action.

GBP/USD Signal

At 9:30 London time there will be a release of UK Services PMI data. Regarding the USD, there is the ADP Non-Farm Employment Change at 1:15pm, followed by the ISM Non-Manufacturing PMI at 3pm, so it should be a fairly active London session overall.

Adam is a Forex trader who has worked within financial markets for over 12 years, including 6 years with Merrill Lynch. He is certified in Fund Management and Investment Management by the U.K. Chartered Institute for Securities & Investment.
Learn more from Adam in his free lessons at FX Academy.