Welcome to our newest feature; DecaPip. The concept is simple: our professional market technician, with an exceptional system, showcases his own daily Support and Resistance levels across a broad spectrum of FX currency pairs. The most effective way to use the levels are:
- If indicated levels hold, look for the price to reverse.
- If levels are broken, look for the price to continue past to new highs or lows.
For this edition of DecaPip Daily I would like to take a close look at GBPUSD and how we could potentially trade it with the UK GDP figures about to be released for the second financial quarter.
I have been looking for a pull back in GBPUSD from the start of this trading week to enter a sell position and make a lower high on the weekly chart to encourage sellers.In Monday’s US trading session my wish was granted as GBPUSD managed to get a reversal of price to 1.5594 and I entered short at 1.5589 and currently have a small gain of around 40 pips in profit.
Looking at this chart over the weekend my trade plan was based solely upon price holding the thicker red trend line below which is essentially holding the previous uptrend structure and price re-tested and rejected it very well.
Ideally now I am looking for follow through to the downside and closing below 1.5480 should open the door for seller’s with the blue lines below as my soft targets.
With the upcoming news my stop loss has been moved to 1.5608 and now I need price action to stay below 1.5594 before the news event at 9.30am GMT.
The chart below really highlights the break out areas if we do see a surge or spike in either direction.
Looking for safe ways to trade this pair after the news tomorrow will be at the forefront of all GBPUSD traders after the news release.
For those not already positioned short a higher time frame close under 1.5480 with good momentum should expose the 1.5300 level if we can break 1.5540 which currently offers excellent support.
Alternatively if we do manage to move higher and break Monday’s high we should look for the bulls to test 1.5637 and 1.5666 again for further confirmation to see if price wants to test near the yearly high’s.
Got any questions about our new DecaPip feature? Contact Nathan at Nathan@littlefishfx.com
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