GBP/USD Signal Update
Monday’s buy signal at 1.6620 was stopped out yesterday at the new break even stop loss, so the trade broke even.
Today’s GBP/USD Signal
Put a buy limit order for a long entry at the first touch of 1.6475.
Place the stop loss at 1.6419.
Move the stop loss to break even when the trade is 25 pips in profit and leave the trade to ride.
Yesterday printed a fairly small and weak bearish candle. However it was significant that yesterday’s close was below the low of the previous day, and the close was also within the bottom half of the candle. As this downwards move looks impulsive after repeated failures to meaningfully break above 1.6750, things are without doubt starting to look bearish for this pair. A candlestick analysis shows bullishness remaining on the monthly chart but the weekly chart is now starting to look bearish. The daily chart looks bearish already. This is indicative of a move down to the next significant support near the key psychological level of 1.6500.
Despite all that, the support at around 1.6620 has not fully exhausted itself, or so it seems, so we may get a move up next. There is local resistance at around 1.6650 which could be a good price at which to look for a short entry, although I am not giving this as a signal.
The coming action is likely to be fairly choppy as we have leftover buying orders below and a selling zone at 1.6650 so me may just bounce around in this sort of zone for a while, which would make the pair less interesting to trade for a while.
We are still well within a wide, long-term bullish channel, in spite of the bearish candlestick indications.
There are no important data releases scheduled today concerning the GBP or the USD so it is likely to be a quiet day.