GBPUSD has made contact with the resistance zone, as predicted from last week's analysis. We're now faced with a decision to short or wait on the sidelines for more price action.

How do we trade this?

It is not reasonable to short just yet because we do not have a sell signal! We're currently at the resistance level but without a confirmation of rejection, there is no justification to short without imposing too much risk. Enter after another sell signal, then 1:2 risk ratio down to the bottom of the trading range around 1.22000.

If the price breaks resistance, wait for it to confirm support on the resistance zone then look for a long entry off of a bull signal and confirmation bar.

Trade Idea

Short Entry: 1.26670
Stop Loss: 1.29000
Take Profit: 1.22000
Risk/Reward Ratio: 1:2

Key Takeaways

1. Trading Range after Bull Run, Bias to Long.
2. Price Currently at Resistance Zone, Look for a Reversal Signal.
3. If Shorting, Watch the 200EMA for Support.
4. If Break Resistance, wait for New Support Confirmation.
5. RSI near 70.00, Bias to Short.

Risk Warning!
Past performance is not necessarily indicative of future results. You are solely responsible for your trades. Trade at your own risk!

Find me at TradingView.com/u/TraderEngineering/

Like and comment if you found this analysis useful!