GBPUSD produced a huge Bearish H4 candle day before yesterday. The pair has been Bearish since then. Yesterday’s Daily candle came out as a Bearish candle too. Today’s first H4 candle was a Bullish corrective candle. Then, the next one came out as a Doji candle. The current candle seems to be Bearish again. If that ends up being a Bearish Engulfing Candle and we get an H1 breakout at yesterday’s lower low, then selling the pair would get us some green pips. Let us have a look at the H4 GBPUSD chart.
GBPUSD Price Action Analysis – 19th July 2018
First, have a look at that huge H4 Bearish candle. That has set the Bearish tone on the H4-GBPUSD chart. Now have a look at the current H4 candle. If it ends like that, then we would have to wait for an H1 candle to make a breakout at the level of 1.30075 to take the short entry. Let us have a look at the summary of the trade…
- Sell Stop Order: 1.30075
- Stop Loss: 1.30820
- Take Profit: 1.28900
- Validity: 72 hours
- Whenever possible, move the stop loss to the entry price and whenever you want, you can take profit anytime as long as you feel comfortable
As we see that the range of movement is quite big here. This is what happens when a pair is on a strong trend. Eventually, this brings a better reward. With an entry, we have to pay spread from 3 to 12 Pips. If the range of movement is tiny, it gets tough to make a good profit after paying the spread. On the other hand, Spread does not bother us that much when the movement is big like this. Thus, try to choose a chart that has a good range of movement.
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