GBP/USD Signal 07/07: Risk-Off Sentiment (Chart)

(MENAFN- Daily Forex) My previous GBP/USD signal on 3^rd July produced a profitable short trade from the bearish rejection of the resistance level at $1.3672.

Today's GBP/USD Signals

Risk 0.75%.

Trades may only be entered before 5pm Tokyo time

Long Trade Ideas

• Long entry following a bullish price action reversal on the 1H1 time frame H1H1H1 timeframe immediately upon the next touch of $1.3561, $1.3512, or $1.3440.
• 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

• Short entry following a bearish price action reversal on the 1H1 time frame H1H1H1 timeframe immediately upon the next touch of $1.3656, $1.3681, or $1.3708.
• 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 last Thursday that waiting for the price to clear $1.3672 before taking any long trade was going to be my approach, and I was correct to see that level as a pivotal point, as it was the rejection of that price area which set up the trade of the day, and it was short.

Markets are moving from risk-on mode towards risk off as focus shifts back to President Trump's new tariffs. This is boosting the US Dollar and also tending to hit riskier currencies such as the British Pound.

Technically, we see a clear top at the resistance level of $1.3681. The price is now falling through an obvious space but is approaching an area which was previously a supportive inflection, and a horizontal support level at $1.3561 which might become today's pivotal point.

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It seems that despite the bearish situation the price might not have much further to fall, so it might be wise to hold off on entering any new short trade until the price gets established below $1.3561.-p

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

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