GBP/USD: Consolidation likely today
Last Thursday’s signals were not triggered, as there was no bearish price action when 1.3009 was reached.
Today’s GBP/USD Signals
Risk 0.75% per trade.
Trades may only be taken before 5pm London time today.
Short Trade Ideas
Go short following a bearish price action reversal on the H1 time frame immediately upon the next touch of 1.3080, 1.3101, or 1.3141.
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.
Take off 50% of the position as profit when the price reaches 20 pips in profit and leave the remainder of the position to run.
Long Trade Ideas
Go long following a bullish price action reversal on the H1 time frame immediately upon the next touch of 1.3009 or 1.2942.
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.
Take off 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 thought we were likely to either see a consolidation around the middle of the range between 1.2942 and 1.3000, or a weakly bullish movement.
This was a fairly good call, as we did get a weakly bullish movement. The price has been able to get established above the round number at 1.3000 and the slightly higher new support level at 1.3009. However, this weakly bullish movement now faces a cluster of resistance between 1.3080 and 1.3101 which will probably be too firm to break during today’s likely quiet market.
I think the only opportunity which we may see here today would be a quick scalp from a bounce off a key level, probably one of the resistance levels at either 1.3080 or 1.3101 with the latter likely to be stronger.
The Pound continues to be bullish while the Euro remains bearish.
There is nothing of high importance due today regarding either the GBP or the USD. It is a public holiday today in the U.S.A.