Daily Price Action
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GBPUSD: Terminal Pattern Nears Completion

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I discussed the GBPUSD twice last week. The first commentary was on Monday shortly after I discovered a 4-hour ascending channel within a larger descending one. The combination offered a way for us to capitalize on strength or weakness.

The second mention came on Thursday as the pound was bouncing from ascending channel support. The bid that formed at 1.3875 helped to confirm the smaller channel which made this future setup that much more attractive.

I also mentioned the GBPUSD again over the weekend along with four other currency pairs. You can view the weekly commentary here.

If last week’s price action didn’t convince you of the favorable technicals, the GBPUSD just sold off from descending channel resistance at 1.4060. As I type this, the pair is on its way to retest ascending channel support for the second time since its inception on February 14.

Upon retesting the 1.4060 area, I opened a small short position at 1.4058. I also announced my entry in the member’s area when prices were hovering around 1.4040.

The pair had already moved more than 100 pips intraday when buyers reached the 1.4060 region, so it was a relatively low-risk entry. Combine the key resistance level and more than favorable risk to reward ratio, and it was worth putting some capital to work.

I will consider adding to the position following a 4-hour close below ascending channel support. That level is currently near 1.3920/30. Key support below that comes in at 1.3600/20.

At this point, I’ve covered my risk. Only a 4-hour close above descending channel resistance near 1.4030/40 would cause me to reverse my short-term bias from bearish to bullish.

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GBPUSD channels on the 4-hour chart

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16 comments
Abdillahi Ahmed Ali says

My name is Abdillahi Ahmed Ali from somalia

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Humphrey says

Thanx

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Sumantra+Kumar+halder says

Thanks a lot.excellent idea for me.

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Michael says

Pls what are the major support and resistance levels for the GBPUSD pair

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Illiace says

Thank you

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Onlyone says

Nice Analysis dear covered from all angles. I did the short trade too at that point but exited too soon for I had no plan for downside ready with me. I read your analysis too late. Well done!

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Bothata says

Which time frame is more accurate for begginers?

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    Nigel says

    The higher the better but the higher you go the larger your stops will be. When you first start with limited funds it’s a difficult one.

    Reply
      Adi says

      you should start low volume like 0.10 for long

      Reply
    Roy says

    yes the daily timeframe is the best. if you have a small capital say $500 then better to trade micro lots so you can learn while you earn and gain experience.

    https://dailypriceaction.com/friday-qna/4-hour-or-daily-time-frame

    https://dailypriceaction.com/friday-qna/how-much-money-can-you-make-trading-forex

    try these links and read the whole site, there is loads of information here to help you.

    Reply
Mandisile says

Hi
Analysis is good I’m in South Africa when you say daily close what time is it in South Africa

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    Justin Bennett says

    5 pm EST.

    Reply
Sydney says

Thanks

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sameh says

Thank You
I think it on the H4 it closed below the ascending channel support
so what is the next level ? is it 1.3850 then 1.3793 then 1.3763
will it reach the 1.36 area?

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Chucks says

You dont just analyze market, you also predict the market accuurately. Thanks a lot. I so much appreciate your work

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Nonso says

thank you sir

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