GBPUSD 4HR CHART - LONG TRADE ANALYSIS
This chart shows the 4-hour time frame for the GBPUSD currency pair. The chart shows the price has moved down to major support and has bounced upward. The most recent 4-hour candle tried to move below the red horizontal Swing Level line but failed to close below it. A bounce off the swing level and a close above the high of the most recent candle will signal a Long Trade.
The red moving average is a 60-period exponential moving average representing a 10-day exponential moving average on the daily chart. The green moving average is a 120-period exponential moving average representing a 20-day exponential moving average on the daily chart.
The price target for the long trade would be in the vicinity of the confluence of the 60 ema, the 120 ema, and the major resistance line.
Notice the 60 ema and the 120 ema are still diverging, this indicates momentum is still increasing. Since momentum is still increasing I would expect the return to resistance would most likely end at either the 60 ema or the major resistance line. I don't expect the price to move all the way back to the 120 ema.
The red moving average is a 60-period exponential moving average representing a 10-day exponential moving average on the daily chart. The green moving average is a 120-period exponential moving average representing a 20-day exponential moving average on the daily chart.
The price target for the long trade would be in the vicinity of the confluence of the 60 ema, the 120 ema, and the major resistance line.
Notice the 60 ema and the 120 ema are still diverging, this indicates momentum is still increasing. Since momentum is still increasing I would expect the return to resistance would most likely end at either the 60 ema or the major resistance line. I don't expect the price to move all the way back to the 120 ema.
Comment:
Although GU did not bounce off the red Swing Level price line as expected it did eventually move back above it and provided a nice Long Entry with a Close above the three Doji and a nice profit. Sometimes the exact trade signal expected does not mature but that doesn't mean the expected trend direction is wrong. We just have to wait for the right Long Entry Setup to mature.