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On Sunday I wrote about how the 1.2850 level on GBPUSD could attract buyers.
Notice how this area served as support during the second half of January. The 1.2850 area also caused last Thursday’s bounce.
Yesterday’s session tested the level once more, but so far GBPUSD bulls are holding firm.
However, remember that key resistance isn’t far above the current price.
GBPUSD failed to hold above channel resistance following the bullish breakout on the 25th of January.
That means the 1.3000 area is once again resistance.
I want to reiterate too that the market as a whole has been incredibly choppy and indecisive so far in 2019.
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As such, you’ll want to be extra cautious about the trades you take. If you have to think twice about risking capital, you may want to stay on the sideline.
In the case of GBPUSD, it may be best to wait to see what happens near the 1.3000 handle. Attempting to go long while below it is too risky for me.
On the flip side, a daily close below 1.2850 would expose the next key support at 1.2700.
Keep in mind that as long as 1.2850 support is intact, the GBPUSD has the potential to bounce back to 1.3000.
Justin Bennett is an internationally recognized Forex trader with 10+ years of experience. He's been interviewed by Stocks & Commodities Magazine as a featured trader for the month and is mentioned weekly by Forex Factory next to publications from CNN and Bloomberg. Justin created Daily Price Action in 2014 and has since grown the monthly readership to over 100,000 Forex traders and has personally mentored more than 3,000 students.Read more...
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