My previous GBP/USD signal on 17th April was not triggered, as none of the key levels were reached that day.
Today’s GBP/USD Signals
- Risk 0.75%.
- Trades may only be entered prior to 5pm London time today.
Long Trade Ideas
- Go long following a bullish price action reversal on the H1 timeframe immediately upon the next touch of $1.2466, $1.2376, or $1.2337.
- 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 25 pips in profit and leave the remainder of the position to run.
Short Trade Ideas
- Go short following a bearish price action reversal on the H1 timeframe immediately upon the next touch of $1.2578, $1.2647, or $1.2710.
- 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 25 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 in my previous forecast for the GBP/USD currency pair just over two weeks ago that the technical picture was looking more bearish, and the price was tending to range between $1.2500 above and the support level at $1.2376. I thought that the best opportunity which might set up was a short trade from a bearish reversal at the $1.2500 area.
This was an accurate call on the market, but the price never quite reached $1.2500 that day.
The technical picture is still showing a consolidation, between $1.2466 and $1.2578.
The long-term trend is bearish, but the price has kept finding support over recent days near $1.2450 which is a weakly bullish sign.
Bulls gets a boost from market sentiment which has the US Dollar on the back foot today after Fed Chair Jerome Powell last night ruled out any rate hikes this year and reiterated his belief the Fed would being to cut rates later during 2024.
I see little chance of a return today to $1.2466, but if the price gets established later above $1.2578, it might well move higher still during the New York session, so there could be scope for a long trade above $1.2578.
There is nothing of high importance scheduled today concerning the GBP. Regarding the USD, there will be a release of Unemployment Claims data at 1:30pm London time.
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