Yet support level at $1.2345 looks likely to be strong.
My previous GBP/USD signal on 28th March was not triggered.
Risk 0.75%.
Trades must be taken before 5pm London time today only.
- Long entry following a bullish price action reversal on the H1 timeframe immediately upon the next touch of $1.2345 or $1.2309.
- 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 entry following a bearish price action reversal on the H1 timeframe immediately upon the next touch of $1.2456 or $1.2479.
- 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.
I wrote in my previous forecast for the GBP/USD currency pair on 28th March that the technical picture looked bullish due to the symmetrical ascending price channel within which the price was firmly established.
This was a good call, as the price rose over that day, and over the next couple of weeks too, before peaking above the big round number at $1.25, then falling back quite firmly over the past few days.
Drilling down into the hourly price chart below, we can see a shorter-term bearish technical picture with signs of recovery, despite the still-valid long-term trend in this currency pair.
There is a bearish head and shoulders chart pattern visible, with the next line zone marked by two trend lines. The price has broken below the neckline but has recovered from a low close to the support level at $1.2435 which looks likely to be strong. The line of least resistance therefore looks likely to be upwards, but I am not convinced that this bullish price movement has much further to run today.
I see the best potential opportunity which might set up here today as a long trade from a bullish bounce at $1.2435 following another bearish retracement which pushes the price down to that support level.
Concerning the GBP, there will be a release of Claimant Count Change data at 9am London time. There is nothing of high importance due today regarding the USD.
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