GBP/USD Forex Signal - 19 August 2019

GBPUSD: Surprisingly bullish above 1.2138

Last Thursday’s signals were not triggered as there was insufficiently bearish price action at 1.2106.

Today’s GBP/USD Signals

Risk 0.75% per trade.

Trades must be taken between 8am and 5pm London time today only.

Long Trade Ideas

  • Go long following a bullish price action reversal on the H1 time frame immediately upon the next touch of 1.2138 or 1.2094.
  • 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.

Short Trade Ideas

  • Go short following a bearish price action reversal on the H1 time frame immediately upon the next touch of 1.2210 or 1.2280.
  • 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 20 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 last Thursday that my analysis saw this pair as essentially bearish below 1.2106 but watch out for support at and close to 1.2000. I was ready to take a bearish bias at 1.2106 if we’d gotten a bearish reversal there.

In a sense 1.2106 was a good pivotal point to watch, as the bearish situation changed completely with the price rising strongly above that level and printing new higher support at 1.2138.

The price looks firm and is rising to new multi-day highs against the long-term bearish trend.

It is hard to say how much further this bullish movement could go, but as long as 1.2138 holds, the price certainly looks likely to rise higher.

I see 1.2138 as likely to be today’s pivotal point, and I would take a cautious bullish bias with conservative profit targets if we get a bullish bounce there later.

gbpusd

There is nothing of high importance due today concerning either the GBP or the USD.

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.