Created on December 16, 2024

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My previous GBP/USD signal on 3^rd December was not triggered, as none of the key levels which I had identified were reached that day.

Today’s GBP/USD Signals

• Risk 0.75%.
• Trades may only be entered before 5pm London time today.

Long Trade Ideas

• Go long following a bullish price action reversal on the 1H1 time frame H1H1H1 timeframe immediately upon the next touch of $1.2626, $1.2609, or $1.2575.

• 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.
• Take off 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 Ideas

• Go short following a bearish price action reversal on the 1H1 time frame H1H1H1 timeframe immediately upon the next touch of $1.2667 or $1.2679. 
• 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.
• Take off 50% of the position as profit when the price reaches 25 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 in my previous GBP/USD forecast almost two weeks ago that price was likely to just chop around over the short term and that this currency pair was not very attractive to trade right now. This was an OK call.

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The price is still relatively aimless without much direction, and this currency pair is not especially in focus today. However, the choppy technical picture could make this a good pair to scalp from bounces off support or resistance. There are two levels which look interesting:

• The support at $1.2626, if it holds, could produce a leg up which would complete the final shoulder of a bullish head and shoulders chart pattern. If the level breaks down, you still have to watch out for the support close below at $1.2609.
• The resistance level at $1.2667 looks likely to be strong.

The obvious likely opportunity now would be a long scalp from $1.2626.

There is nothing of high importance due today concerning either the GBP or the USD.

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