GBP/USD Forex Signal: Evenly Balanced

Adam Lemon

The price is likely to turn bearish again eventually.

.My last GBP/USD signal on 9th June was not triggered, as none of the key levels identified were reached that day.

Today’s GBP/USD Signals

Risk 0.75%.

Trades must 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 $1.2183 or $1,2040.
  • 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.
  • Remove 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 $1.2260 or $1.2338.
  • 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.
  • Remove 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 in my last forecast on 9th June that the technical picture was one of a wide, somewhat choppy consolidation between roughly $1.24 and $1.26. I thought that the best approach would be to look for scalping trades off extreme support or resistance levels such as $1.2437 or $1.2600. This was sufficient to stay out of trouble, but also did not produce any profitable trading setups

The price fell strongly last week, trading below the big round number at $1.2000 before recovering quite firmly over recent days. The price chart below suggests that the price is quite evenly balanced between equally spaced support and resistance levels. This plus the fact that today is a Monday with no major news or data releases scheduled, suggests that the price is likely to be very unpredictable and choppy today. In any case, it will probably move only by a little.

If you are going to trade this currency pair today, scalping reversals from key levels as they set up will be likely to be the best approach, but profits are likely to be very minimal so trades should be monitored very carefully on short time frames.

Longer-term traders looking for bigger swings will probably do best to trade major cryptocurrencies today.

GBP/USDThere is nothing of high importance scheduled today regarding the GBP or USD. It is a public holiday in 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.
Learn more from Adam in his free lessons at FX Academy

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