Yesterday’s signals were not triggered, as the initial bearish price action took place a little way above 1.3818.
Today’s GBP/USD Signals
Risk 0.75% per trade.
Trades may only be entered between 8am and 5pm London time today.
Short Trades
Short entry following a bearish price action reversal on the H1 time frame immediately upon the next touch of 1.3872 or 1.3940.
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.
Long Trades
Long entry following a bullish price action reversal on the 1H1 time frame immediately upon the next touch of 1.3824 or 1.3758.
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
Yesterday I maintained a bearish bias, noting that despite the recent slight recovery, the Euro was notably stronger than the Pound. Although this pair rose, the situation is unchanged, with the Euro significantly stronger than the Pound, which suggests a latent weakness. The technical picture has changed a little, with new higher support levels, but also more obvious lower resistance. A break below 1.3824 looks likely at the time of writing and would be a bearish sign. I have a cautious bearish bias here, insofar as if the Dollar recovers, it should do well against the Pound.
Concerning the GBP, a member of the Bank of England’s MPC will be speaking at 6:15pm London time. There is nothing due regarding the USD.