GBP/USD Signals Update
Yesterday’s signals were not triggered as there was no bearish price action at 1.3023 or 1.2940.
Today’s GBP/USD Signals
Risk 0.75% per trade.
Trades may only be entered before 5pm London time today.
Long Trades
* Long entry following a bullish price action reversal on the H1 time frame immediately upon the next touch of 1.3023, the broken bearish trend line at around 1.2962, or 1.2940.
* 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.
* Remove 50% of the position as profit when the price reaches 25 pips in profit and leave the remainder of the position to run.
Short Trades
* Short entry following a bearish price action reversal on the H1 time frame immediately upon the next touch of 1.3101 or 1.3172.
* 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.
* Remove 50% of the position as profit when the price reaches 25 pips in profit and leave the remainder of the position to run.
GBP/USD Analysis
Yesterday I wrote that “Short trades remain the best bet in line with the longer-term trends, but beware of the supportive area below which may hold.” Although the price did not quite reach the first support level, the combination of better than expected U.K. economic data and the USD getting sold off strongly was enough to make this pair the best performer of the day.
Technically the most interesting thing is hold the two resistance levels which were breached have both flipped very precisely to support so far.
Looking at a daily chart, there is a suggestion of some kind of longer-term double bottom being put in below 1.3000.
Trades should be taken very cautiously as the FOMC release is due later after London closes.
Concerning the GBP, there will be a release of Average Earnings Index and Claimant Count Change data at 9:30am London time. Regarding the USD, there will be releases of Crude Oil Inventories at 3:30pm followed by the FOMC Meeting Minutes at 7pm.