Today on GBPUSD – Are the Daily and H4 charts supporting Long trades?

NOTE: These are very challenging times for trending methods: judging from the four majors that I trade, the market simply is indecisive. Like me, if you decide to stay in the market – and not stay away – proper Trade Management is the “HOLY GRAIL” here, and with that, please let us remember to keep our risks per trade very low. Large draw downs are very difficult to recover from.

On the Daily chart above, price seems to be in a sustained but very sluggish upward move. Currently, price is approaching a critical resistance level @ 1.6556 (which we’ve highlighted using the lower blue broken line) – about 50 pips away. A break above that level would ease our concern for any major obstacle to continuous price move upward. As a moderately conservative trader, please wait for the break above 1.6556 before seeking Long trade set-up on the Hourly; as a very conservative trader, I think it’s advisable to stay completely out of the market - I’m primarily referring to the four majors that I study; however, this view probably applies to virtually all pairs as, I believe, the economic uncertainties are global issues.

On the H4 chart Price has broken the most recent swing high @ 1.6503 (which we’ve highlighted using the lower blue broken line) upward. The critical resistance level @ 1.6556 that we referred to on the Daily chart is also visible on the H4 (this we’ve highlighted using the upper blue broken line). Please keep this level in mind. In all, from a day-trade perspective, the H4 chart is supporting a Long trade. The green horizontal line @ 1.6309 highlights the most recent swing low, and as long as price stays above it – in the absence of any new and higher swing low – our bullish or upward bias remains intact.

However, if you decide to go Long, we still need our Hourly charts – using Fibonacci retracement levels and important support levels – to seek promising areas to take our Long positions. Price pattern on the Hourly must also be forming higher highs and higher lows. Please note that our aim is to buy a dip in today’s up-trend.

Also, PATIENCE is the key here: we need to patiently wait for the Hourly retracement. It might happen, and it might not.