Yesterday’s signals produced a profitable long trade following the bullish engulfing candle structure rejecting the support level at 1.3381, but it only gave the minimum 25 pips of profit.
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 1.3381, 1.3337, or 1.3286.
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.
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 wrote yesterday that the price most likely had further to fall, to at least 1.3381, where it might turn around and find some support. This is exactly what happened. However, the short-term action is looking more bearish than bullish, which suggests the level is going to be tested again. The support at 1.3381 will probably be less likely to hold on a second test.
This pair remains the most volatile of all the major currency pairs, and it has been at the heart of the Forex market for some time as there is so much uncertainty over the terms of the U.K.’s exit from the European Union.
There is nothing important due today concerning the GBP. Regarding the USD, there will be a release of the ADP Non-Farm Employment Change at 1:15pm London time, followed by Crude Oil Inventories at 3pm.