GBP/USD Forex Signal - 10 May 2018

By: DailyForex

Yesterday’s signals produced a long trade entry from the bullish engulfing candlestick which rejected the support level at 1.3500. This has given a little more than 62 pips of profit so far.

Today’s GBP/USD Signals

Risk 0.75% per trade.

Trades may only be taken before 5pm London time today

Short Trades   

  • Go short following a bearish price action reversal on the 1H1 time frame H1H1H1 time frame immediately upon the next touch of 1.3597 or 1.3666.
  • 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 Trade  

  • Go long following a bullish price action reversal on the 1H1 time frame H1H1H1 time frame immediately upon the next touch of 1.3500, 1.3456, or 1.3431.
  • 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 we saw the key resistance level confluent at the round number of 1.3500 hold again, and the price make higher lows and higher highs. Despite the long-term bearish trend, it looks as if the price is readying to make a deeper bullish retracement or possibly even a major reversal. The nearest resistance level has had to be adjusted upwards to 1.3597. A break above that level would be a bullish sign. The problem with forecasting today’s price movement is that there will be major data concerning both currencies, with the Bank of England’s major release due soon. This means that anything could happen. A hawkish surprise should have an especially strong impact, as the Pound is looking relatively strong over recent hours.

GBP/USD

Concerning the GBP there will be a release of Manufacturing Production data at 9:30am London time, followed at Noon at the Bank of England’s Inflation and Monetary Policy Reports and the Official Bank Rate. Regarding the USD, there will be a release of CPI data at 1:30pm. 

Adam Lemon

Adam Lemon began his role at DailyForex in 2013 when he was brought in as an in-house Chief Analyst. Adam trades Forex, stocks and other instruments in his own account. Adam believes that it is very possible for retail traders/investors to secure a positive return over time provided they limit their risks, follow trends, and persevere through short-term losing streaks – provided only reputable brokerages are used. He has previously worked within financial markets over a 12-year period, including 6 years with Merrill Lynch.