GBP/USD: Unpredictable price action at the lows
Yesterday’s signals were not triggered, as the price never reached 1.3080.
Today’s GBP/USD Signals
Risk 0.75% per trade.
Trades must be entered between 8am and 5pm London time today only.
Short Trade Ideas
Short entry following a bearish price action reversal on the H1 time frame immediately upon the next touch of 1.3009, 1.0346, 1.3080 or 1.3101.
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.
Adjust 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 yesterday that if the price could get established above 1.3050 early on, it would be likely to rise higher to at least 1.3080 over the course of the day. I was wrong about this as the price broke 1.3050 but never hit 1.3080 before falling again. However, I did avoid being ready to take a long bias, as I was looking for a short trade, so my directional approach was correct.
The Dollar is very strong and is threatening to make major breakouts against the Euro and the Yen, so we might expect downwards movement here. However, the Pound is perhaps a little stronger than many other currencies, so looking closely at whether key support and resistance levels hold is likely to be a better approach.
I would be prepared to take a short trade at bearish reversals at any resistance level, especially 1.3009. I would feel much more strongly bearish below 1.2950 if the price can get there.
There is nothing of high importance due today regarding either the GBP or the USD.