Last Thursday’s signals produced a profitable long trade following the bullish inside candle rejecting the support level identified at 1.3344. It looks like this trade has given all the profit it is ever going to give already.
Today’s GBP/USD Signals
Risk 0.75% per trade.
Trades must be taken between 8am and 5pm London time today only.
Long Trades
- Go long following a bullish price action reversal on the H1 time frame immediately upon the next touch of 1.3344 or 1.3250.
- 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.
- 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 Trade 1
- Go short following a bearish price action reversal on the H1 time frame immediately upon the next touch of 1.3459.
- 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.
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 was correct last Thursday in seeing a possible rise from 1.3344, although the price never quite made it to 1.3465 as I had thought it would. The price is now again approaching 1.3344 which might hold a second time, but I am not optimistic that this will happen as sentiment seems to be buying the U.S. Dollar. In the unlikely event that the price falls all the way down to 1.3250, there could be a very significant bullish bounce there. However, there will shortly be a release of U.K. economic data which might push the price up, but leaving that aside, I have a bearish bias today.
Concerning the GBP, there will be a release of Manufacturing PMI data at 9:30am London time. Regarding the USD, there will be a release of ISM Manufacturing data at 3pm.