GBP/USD Bullish Forex Analysis, Nearing 9-Month High Price
Today’s GBP/USD Signals:
Risk 0.75%.
Trades may only be entered before 5 pm London time today.
Long Trade Idea
- Long on the next touch of $1.2292 or $1.2266 after a bullish price action reversal on the H1 timeframe.
- Set the stop loss one pip below the current swing low.
- If the transaction is 25 pips in profit, adjust the stop loss to break even.
- When the price reaches 25 pips in profit, take 50% of the trade as profit and let the rest of the position run.
Short Trade Ideas
- Short after a negative price action reversal on the H1 timeframe, on the next touch of $1.2368 or $1.2467.
- Set the stop loss one pip above the current swing high.
- If the transaction is 25 pips in profit, adjust the stop loss to break even.
- When the price reaches 25 pips in profit, take 50% of the trade as profit and let the rest of the position run.
The best way to spot a classic "price action reversal" is for an hourly candle to close with a higher close, such as a pin bar, doji, outside, or even just an engulfing candle. You can profit from these levels or zones by observing the price action that occurs at the specified levels.
GBP/USD Analysis
The previous forecast for the GBP/USD currency pair on Monday last week that was weakly bullish, with room to rise before reaching the nearest resistance level at $1.2264. We're looking to enter a new long trade if we got a bullish bounce at the nearest support level of $1.2167, targeting the resistance level at $1.2264.
This was a good call as it correctly identified a profitable trade opportunity.
The technical picture remains bullish, as the downward trend in the US Dollar continues over both the long and short terms. The British Pound is quite strong, and the price is now only about 100 pips from its highest price since June 2022.
Technically, the bullish case is strengthened by the symmetrical ascending price channel within which the price is firmly established, as shown in the price chart below.
At now, the price appears to be seeing little resistance around $1.2325, but this may be overcome. A retreat to the nearest support level around $1.2292, followed by a strong bullish recovery, could present an ideal chance to begin a fresh long trade. This will seem considerably better if the rejection of the confluent round number at $1.2300 is also visible.
About the GBP, at 9:45 a.m. London time, the Governor of the Bank of England will speak before the British Parliament regarding the American financial crisis. The CB Consumer Confidence statistics for the USD will be released at 3 pm.