GBP/USD: New 50-day high daily close
Last Thursday’s signals were not triggered as the bearish rejection of the resistance level identified at 1.2624 did not happen before the London close.
Today’s GBP/USD Signals
Risk 0.75% per trade.
Trades must be taken before 5pm London time today only.
Short Trade Idea
- Go short following a bearish price action reversal on the H1 time frame immediately upon the next touch of 1.2842.
- Place 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 25 pips in profit and leave the remainder of the position to ride.
Long Trade Idea
- Go long following a bullish price action reversal on the H1 time frame immediately upon the next touch of 1.2624.
- Place 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 25 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 I saw the likely price movement as too difficult to predict with any confidence. The picture may be clearer by the end of the day’s London session.
We saw a key bullish breakout the next day, on Friday, when the key resistance level at 1.2624 was broken to the upside and the price ended the week with a new 50-day high closing price.
There is an accelerating long-term bullish trend here which suggests higher prices will be reached soon. It is likely that the nearby probable support at 1.2624 could be a good entry point for a long trade, if we see a bullish bounce there when it is hit.
As it is Monday with no key data releases for either currency in this pair, it is likely that there will be little price movement today, but it is worth paying attention to this pair and seeking long trades.
There is nothing of high importance due today concerning either the GBP or the USD.