Last Thursday’s signals were not triggered, as there was insufficiently bearish price action at 1.4090.
Today’s GBP/USD Signals
Risk 0.75% per trade.
Trades must be taken before 5pm London time today.
Long Trade
Go long following a bullish price action reversal on the H1 time frame immediately upon the next touch of 1.3981.
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
Go short following a bearish price action reversal on the H1 time frame immediately upon the next touch of 1.4168.
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
This pair has surprised me with its relative strength against its sister pair, the EUR/USD. I expected last Thursday that the pair would break below its support and start to trade well below 1.4000, yet it in fact rose strongly before falling back again quickly. There is a long-term bullish trend, so we have two bullish factors here. The question that is likely to determine the short to medium-term outcome is whether the price can hold up above the 1.4000 / 1.3981 area of support. If the price cannot get below here today, and survives through the Asian session later, it is likely to rise again. If the price breaks below the 1.3920 area, it could fall much further. A break below 1.3981 is also likely to produce a fall to at least 1.3920.
There is nothing due today concerning either the GBP or the USD. It is a public holiday in the U.S.A.