GBP/USD Forex Signal

GBPUSD: More bearish

Yesterday’s signals were not triggered, as none of the key levels were ever reached.

Today’s GBP/USD Signals

Risk 0.75% per trade.

Trades may only be taken before 5pm London time today.

Long Trade

• Go long following a bullish price action reversal on the H1 time frame immediately upon the next touch of 1.2642.

• 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.

• Remove 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

• Go short following a bearish price action reversal on the H1 time frame immediately upon the next touch of 1.2702.

• 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.

• Remove 50% of the position as profit when the price reaches 20 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 yesterday that although recent price action had continued to be relatively choppy, we might have got some more directional clarity due to the upcoming British GDP economic data release, but that I would stand aside from trading this pair in the meantime.

This was a good call as the GDP data was poorer than expected and has created a more bearish environment for this currency pair. The release caused a downwards wave and then a retracement against that sold off at a new lower resistance level of 1.2702, which is very confluent with the round number at 1.2700.

It is difficult to say what will happen next, even though the situation is more bearish. I would prefer a short trade from 1.2702 to a long trade from 1.2642 as there is a long-term bearish trend here.There is nothing important due today concerning the USD. Regarding the GBP, there will be a release of Average Earnings Index data at 9:30am London time.