Signal for 13/07/2009 for: GBP/USD

Recap of last week's events:

RESULTS:

Profit +177 pips Loss -50 pips

Total for the week +127 pips

Last week was yet another good week with some nice profit targets being met. We had no trades on Friday mainly because I was happy with the profits made for the week.

OK, back to business. Last week the GBP/USD lost 300 pips and gain back 300 pips at the end of the week. It seems that this pair is going through a retracement at this point. This pair may head further down today but this is purely speculative at this point in time. The level I will be monitoring today is 1.6150. A break of that level may eventually push price further down.

Today's Signals:

Ok let’s have a look at today’s level:

R3-1.6528
R2-1.6442
R1-1.6324
Pivot Point-1.6239
S1-1.612
S2-1.6035
S3-1.5917

Possible Scenarios:

As I said earlier we may see price head down but we will wait for the London open before deciding what to do.

Buy Signal:

For a buy signal to be triggered, I will wait for the price to trade above pivot point by London open. The pivot point for today’s session may act as a good support if price trades above that level due to heavy cluster formations.

If price trades above that level, I will start looking for a good entry with target set at 1.6279 and second target at 1.6310. I will exit all my positions at this level as we may encounter heavy resistance.

I will look for another buy signal only if price breaks the 1.6324 level. My targets for this entry will be at 2 different levels: namely 1.6357, and may be at 1.6384. We may encounter some resistance after 1.6359, thus proper money management is crucial.

Always remember, those are simply possible target where price may head up due to heavy cluster formations and analysis. This is not 100% accurate, no system is. Take profit each time you reach a certain level and bring your stop to break even. Note: Wait for a retest with 20EMA, 50SMA all heading up. Make sure that the 200SMA is not in the way when price is heading up as this may act as a strong resistance.

Sell Signal

At the time of analysis, price gapped down and encountered some good support at 1.6180. Above that level we have some good resistance at 1.6230. Price my range between those levels until London open. If by London session open the market price is in between these levels, I will wait for price to break 1.6230 and start looking for a sell entry.

My first target is set at 1.6135 where I will exit my full position as we encounter some strong support at this level. 1.6150 levels seems to be a crucial level today, so for another sell entry, I will wait for a break of 1.6120 with profit target set at 1.6060 and second target set at 1.6030.

At this point there seem to have heavy support at 1.6000 level, This may be another crucial level for the coming days. A break of that level may eventually push price down for the coming days.

Remember that proper money management will be needed to maximize profit.

Wait for retest of the levels given once broken or until a bullish candle is formed after the retrace (preferably on 15 mins chart making sure that the 20EMA and 50SMA obeys the rule of entry)

PS – You may decide to use your own strategy and use those levels as entry and exit points

Happy Trading.

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