Strong bullish reversal from the low

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The ascending price channel continues to hold.

My previous GBP/USD signal on 5e September was not triggered as there was no bearish price action when price first hit the resistance level I had identified at $1.1496.

GBP/USD Signals Today

Risk 0.75%.

Trades can only be entered before 5pm London time today.

Long Business Ideas

  • Long entry following a bullish reversal in H1-frame price action immediately following the next touch of $1.1649, $1.1602 or $1.1556.
  • Put the stop loss 1 pip below the local swing low.
  • Adjust the stop loss to break even once the trade has reached 25 pips of profit.
  • Withdraw 50% of the position as profit when the price reaches 25 pips of profit and let the rest of the position work.

Short business ideas

  • Go short after a reversal in bearish price action on the H1 time frame immediately after the next touch of $1.1758 or $1.1878.
  • Put the stop loss 1 pip above the local swing high.
  • Adjust the stop loss to break even once the trade has reached 25 pips of profit.
  • Withdraw 50% of the position as profit when the price reaches 25 pips of profit and let the rest of the position work.

The best method to identify a classic “price action reversal” is to close an hourly candle, such as a pinbar, doji, outside, or even just an engulfing candle with a higher close. You can exploit these levels or zones by observing the price action that occurs at the given levels.

GBP/USD Analysis

I wrote in my previous forecast on Monday last week that the price was trading near a 2.5 year low and showing very strong bearish momentum. I noted that the bears might find hurdles from the lower trendline of the descending price channel and another test of the 37-year low price at $1.1409.

I was right, ultimately, on both – price rejected the lower trendline and then rose to make a strong day. Then a few days later, price tested the 37-year low at $1.1409 and strongly rejected it and has since risen in a new, shorter-term ascending price channel.

This more bullish picture was supported by the weakening of the US Dollar. However, today we will have the release of some very crucial US CPI (Inflation) data which could dramatically change sentiment. on the greenback if the figure deviates enough from expectations to be a major surprise.

If the US CPI release later today is not a surprise, I will be looking for a long trade from $1.1649, or even better, from the support level at $1.1602, this which seems to be very strong. as it merges with both the round figure at $1.1600 and the lower trend line of the ascending channel – scalpers should definitely pay attention to the price touching this lower level as there should be a long scalp high probability pending at this level if reached.

Regarding the USD, there will be a release of CPI (inflation) data at 1:30 p.m. London time. There is nothing very important to do today regarding the GBP.

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