GBP/USD Signal Update
Last Thursday’s signals expired without being triggered as although the price did reach 1.6738, the price action at that level was not bearish enough to trigger a short trade.
Today’s GBP/USD Signals
Risk 0.75%.
Entries may be made only between 8am and 5pm London time today.
Long Trade 1
Long entry following bullish price action upon the first touch of 1.6684.
Place the stop loss 1 pip below the local swing low.
Move the stop loss to break even when the price reaches 1.6730.
Remove 75% of the position as profit at 1.6730 and leave the remainder of the position to run.
Short Trade 1
Short entry following bearish price action upon the first touch of 1.6812.
Place the stop loss 1 pip above the local swing high.
Move the stop loss to break even when the price reaches 1.6760.
Take off 25% of the position as profit at 1.6760 and leave the remainder of the position to ride.
GBP/USD Analysis
After the fairly strong break down through the long-term bullish trend line last week, we had a small bullish pull-back over the final two days of last week. However this has not taken us back to any key resistant levels or even the broken trend line yet.
It would seem unlikely that we are going to get any sustained move back up above that broken bullish trend line and so bias should be short, primarily due to GBP weakness rather than USD strength.
The support turned into resistance level at 1.6812 looks very tempting today as it is quite confluent with the broken bullish trend line, and will become more confluent as the hours pass by. This could be an excellent place to take a short trade today if the price gets there.
Below us there should be good support at 1.6684. If this level is not reached today it will become even stronger support.
There should be more potential on short trades than on long trades.
At 9:30am London time there will be a release of U.K. Manufacturing PMI data which may affect the GBP. Later at 3pm, there will be a release of U.S. ISM Manufacturing CPI data which may affect the USD. It is likely to be a more active Monday than usual.