GBP/USD Forex Signal - 6 May 2019

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Last Thursday’s signals were not triggered, as none of the key levels were reached during the day’s London session.

Today’s GBP/USD Signals

Risk 0.75% per trade.

Trades may only be entered between 8am and 5pm London time today.

Long Trades

  • Long entry following a bullish price action reversal on the H1 time frame immediately upon the next touch of 1.3093, 1.3041, or 1.2963.

  • 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.

  • Remove 50% of the position as profit when the price reaches 25 pips in profit and leave the remainder of the position to run.

Short Trade

  • Short entry following a bearish price action reversal on the H1 time frame immediately upon the next touch of 1.3250.

  • 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.

  • 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.

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GBP/USD Analysis

I wrote last Thursday that due to the lack of any long-term trend and a scheduled major policy release from the Bank of England, it would probably be best to step aside from trading this pair that day.

The price rose sharply on Friday as it became apparent that the two major British political parties would start trying harder to come to an arrangement on agreeing a Brexit deal which would be acceptable to the European Union in the wake of local election results. This caused the price to rise sharply. The environment now is risk-off which will tend to push this pair down, but that could easily turn around on good trade news about the threatened tariffs, so a bullish bounce at any nearby support level could still be a good long trade entry. However, it is a holiday in London, so liquidity should be thin before New York opens.GBPUSDThere is nothing important due today concerning either the GBP or the USD. It is a public holiday today in the U.K.

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.