Last Thursday’s signals were not triggered as the bearish price action took place a little way above 1.4168.
Today’s GBP/USD Signals
Risk 0.75% per trade.
Trades may only be entered between 8am and 5pm London time today.
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.
Long Trade
· Go long following a bullish price action reversal on the H1 time frame immediately upon the next touch of 1.4043.
· 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.
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
The U.S. Dollar has been weak lately, and this pair, which is in a firm long-term bullish trend, has been the main beneficiary of that, along with the USD/JPY. The price has been moving up for several days and made a key bullish breakout beyond 1.4000. We now look at the way 1.4168 is blocking the further advance and ask whether there will be a similar bullish breakout beyond that level. If there is, the price could rise significantly, as there are no obvious resistance levels beyond it until 1.4330. However, 1.4168 is for now continuing to hold the price, and it may form a strong double top that will instead push the price back down towards the 1.4000 area. The level should be closely watched. Despite this strong resistance, I have a bullish bias.
There is nothing due today concerning the GBP or the USD.