Yesterday’s signals produced a losing short trade following the bearish pin candlestick which rejected the resistance level identified at 1.3597, although there was a profitable re-entry possible later from the same area which did hold as the high of the day.
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 H1 time frame immediately upon the next touch of 1.3601 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 H1 time frame immediately upon the next touch of 1.3534 or 1.3456.
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 it was likely that the range would continue to hold today in the absence of any major news releases, and so it proved to be, with only a single hourly candlestick close above the resistance level of 1.3597. It looks now as if the support level at 1.3534 may be making its presence felt even though the price did not quite reach it. This pair is showing every sign that it will continue to range and consolidate which will make it very difficult to trade except at the extremes after a relatively strong directional move, and even then, only for limited profit targets.
Concerning the GBP, there will be a release of Average Earnings Index data at 9;30am London time. Regarding the USD, there will be a release of Retail Sales data at 1:30pm.