GBP/USD Forex Signal

Yesterday’s signals were not triggered, as the bearish price action took place a little way above the upper channel trend line.

Today’s GBP/USD Signals

Risk 0.75% per trade.

Trades may only be taken before 5pm London time today.

Short Trade  

  • Short entry following a bearish price action reversal on the H1 time frame  immediately upon the next touch of the upper channel trend line shown in the price chart below which currently sits at about 1.2828.
  • Put 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   

  • Long entry following a bullish price action reversal on the H1 time frame immediately upon the next touch of 1.2616.
  • Put 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 sentiment on the Pound was very weak as the British government’s Brexit plan looks doomed, with betting odds of about 20% on its successful passage later this month being offered, holding out the likely prospect of a no deal Brexit. This is keeping the Pound down and a strong break below 1.2700 was quite possible. I said I would take a bearish bias if the price could trade below 1.2700 for a couple of hours later. Although the price fell sharply and eventually made a new 1-year low, the price did not stay below 1.2700 during the London session. The Pound looks weak as the British government suffered some Parliamentary defeats yesterday which suggest they are at serious risk of losing control of the Brexit process. I remain bearish on this pair and would take a bearish bias today at a strong break below the price channel shown in the chart below, or at a clear bearish reversal at the upper channel trend line.

GBPUSD

There is nothing important due today concerning either the USD or the GBP.

Adam is a Forex trader who has worked within financial markets for over 12 years, including 6 years with Merrill Lynch. He is certified in Fund Management and Investment Management by the U.K. Chartered Institute for Securities & Investment. Learn more from Adam in his free lessons at FX Academy.