My previous GBP/USD signal on 24th February was not triggered, as there was no bullish price action when the support level at $1.2621 was first reached.
Today’s GBP/USD Signals
Risk 0.75%.
Trades may only be taken before 5pm London time today.
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Long Trade Ideas
- Long entry following a bullish price action reversal on the H1 timeframe immediately upon the next touch of $1.2877, $1.2803, or $1.2761.
- 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
- Short entry following a bearish price action reversal on the H1 timeframe immediately upon the next touch of $1.2923, $1.2948, or $1.3000.
- 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 GBP/USD forecast on Monday last week that the price was looking weakly bullish, if the support level at $1.2621 held.
The support level did not hold that day, and the action was marginally bearish, so it was an accurate call although not very useful.
The technical picture has changed dramatically, although it was in line with an earlier dominant trend which was relative strength in the British Pound. Over the past few days, ever since the Trump administration imposed 25% tariffs on Mexico and Canada, the US Dollar has weakened, and the British Pound has been a primary beneficiary from that due the Pound’s residual strength.
The price has risen very strongly over the past few days and is continues to reach new 3-month highs. The price is not far from a 4-month high.
Despite trading bullishly in blue sky, this bullish run has a temporary feel to it, as it is driven by policies which can be reversed in an instant, which could send the price flying lower quickly.
It makes sense to take advantage of the bullish momentum here, although the run may be over-extended by now.
I would look for a long scalp from a bullish bounce at the nearest support level of $1.2877.
There is nothing of high importance due today regarding the GBP. Concerning the USD, there will be a release of Unemployment Claims data at 1:30pm.
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