The GBP/USD signal from November 25th didn’t get triggered.
Today’s GBP/USD Signal
Risk is at 0.75%.
Trades must be placed before 5 PM Tokyo time on Wednesday.
Long Trade Ideas
- After a bullish reversal in the H1 timeframe, consider going long if the price touches $1.3201, $1.3153, or $1.3141.
- Set your stop loss 1 pip below your local swing low.
- When the trade is up by 25 pips, adjust your stop loss to break even.
- Take 50% profit when the price reaches a gain of 25 pips, and leave the rest of your position to run.
Short Trade Ideas
- Look to short after a bearish price movement touches $1.3268, $1.3289, or $1.3326 in the H2 timeframe.
- Set your stop loss 1 pip above your local swing high.
- Adjust your stop loss to breakeven when the trade is up by 25 pips.
- Take 50% of your position for profit when you hit a 25 pip gain, keeping the rest open.
To spot a “price reversal,” it’s often best to look for hourly candlestick patterns, like a pin bar, doji, engulfing or outside candlestick that closes higher. Monitoring movements at these levels can be quite beneficial.
GBP/USD Analysis
In my last forecast on November 25th, I noted a bullish bias while indicating that prices could rise to around $1.3164 if they remained above $1.3128. This seemed to hold water.
The recent price trend has shown strength for about a week now, especially at the support level around $1.3201, which aligns nicely with the round number of $1.3200.
There’s a bearish double top around $1.3268, while a bullish double bottom is at $1.3201. Although there’s a long-term bullish sentiment for the dollar, there’s growing uncertainty since 87% anticipate that the Fed might cut interest rates by 0.25% soon. The DXY (US dollar index) is also showing a less than optimistic outlook currently.
I usually favor breakout trades with this pair, though a pullback to $1.3201 followed by a bounce could present an appealing long entry point.
The strength of the British pound is notably due to the UK’s high inflation rate (3.8%), which limits the Bank of England’s ability to lower interest rates.
Today, there isn’t anything major happening with either the pound or the US dollar.
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