GBPUSD: Short-term bullish above 1.2760
Yesterday’s signals were not triggered as there was no bullish price action at 1.2728.
Today’s GBP/USD Signals
Risk 0.75% per trade.
Trades may only be taken before 5pm London time today.
Long Trade
Go long following a bullish price action reversal on the H1 time frame immediately upon the next touch of 1.2709.
Put the stop loss 1 pip below the local swing low.
Adjust 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
Go short following a bearish price action reversal on the H1 time frame immediately upon the next touch of 1.2828.
Put the stop loss 1 pip above the local swing high.
Adjust 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 20 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.
GBP/USD Analysis
I wrote yesterday that I would take a bullish bias on this pair if it closed at a new high at 9am London time on above-average volatility. It did not. Although the price rose a little during the day, and the USD is weak everywhere, I am nervous about long of this pair as other currencies are far stronger against the Dollar than the Pound is, so I see the Pound as relatively weak with the prospect of a no deal Brexit still very much on the table for October.
Technically, the area around 1.2750 is a significant round number. If the price can close at a new high above 1.2760 at 9am London time, I would see this as a definite bullish sign that we will get higher prices still over the course of this day. However, I am nervous of the Pound’s vulnerability and so think that using EUR/USD instead for a long trade would be a better bet now.
There is nothing of high importance due today regarding the GBP. Concerning the USD, there will be a release of CB Consumer Confidence data at 3pm London time, followed by a speech on monetary policy from the Chair of the Federal Reserve at 6pm.