GBP/USD Forex Signal - 18 July 2019

Adam Lemon

GBPUSD: Small recovery from yesterday’s 27-month low price

Yesterday’s signals were not triggered, as there was no bearish price action when 1.2430 was reached.

Today’s GBP/USD Signals

Risk 0.75% per trade.

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

Long Trade Ideas

  • Go long following a bullish price action reversal on the H1 time frame immediately upon the next touch of 1.2430, 1.2388, or 1.2364.

  • 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 Idea

  • Go short following a bearish price action reversal on the H1 time frame immediately upon the next touch of 1.2495.

  • 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 I expected the price to fall further over the day, as it tends to after such a strong fall the previous day. Although the price did drop lower to about 1.2385 early in the London session, it subsequently recovered and made a relatively small but significant recovery, printing new higher support at 1.2430. If this level holds up today, it becomes more likely that we have put in a major low, but I would be extremely careful taking any long trades in the British Pound right now.

I would take a bearish bias if the price rises to the next resistance level at 1.2495 and fails there, especially if 1.2500 is hit also in the same move.GBPUSDRegarding the GBP, there will be a release of Retail Sales data at 9:30am London time. There is nothing of high importance due today concerning the USD.

About the Author
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.
Learn more from Adam in his free lessons at FX Academy

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