Yesterday’s signals were not triggered, as there was no bullish price action at 1.3125.
Today’s GBP/USD Signals
Risk 0.75% per trade.
Trades must be entered 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 1.3094 or 1.3018.
Place the stop loss 1 pip below the local swing low.
Move the stop loss to break even once the trade is 25 pips in profit.
Take off 50% of the position as profit when the price reaches 25 pips in profit and leave the remainder of the position to ride.
Short Trades
Go short following a bearish price action reversal on the H1 time frame immediately upon the next touch of 1.3162 or 1.3226.
Place the stop loss 1 pip above the local swing high.
Move the stop loss to break even once the trade is 25 pips in profit.
Take off 50% of the position as profit when the price reaches 25 pips in profit and leave the remainder of the position to ride.
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
This pair remains at the heart of the market, as measured by volatility. I wrote yesterday that as we see early indications that the price has now made a triple top at the 1.3226 level, and if this structure holds, it will suggest that today will be a bearish day, with more gains for the USD and no news scheduled which might change sentiment. This is exactly what happened, with the price breaking down past the former support at about 1.3150. The technical picture now is somewhat uncertain, as we have both bullish and bearish lower trend lines which conflict. I think a move down to about 1.3100 will probably happen but we could see a strong bullish reversal there. As there is news due today for both currencies in this pair, it is hard to predict the sequence of events.
Concerning the GBP, there will be a release of Preliminary GBP at 9:30am London time. Regarding the USD, there will be a release of Core Durable Goods Orders at 1:30pm, followed by Crude Oil Inventories at 3pm.