Yesterday, GBP gave a strong sell signal, not only on the Cable but on other pairs as well. Today, these signals are being denied, which could provide some great opportunities. It is a signal to open a position in the opposite direction.
GBPUSD bounced nicely from the neckline yesterday and it looked like we were about to see a sweet drop aiming at the long-term upwards trend line. This drop did not happen and today, the price is testing the neckline again. The comeback is so strong that we have a high chance of breaking the neckline, which will cancel the H&S formation. If the day closes above the 1.409, a buy signal will be triggered.
EURCAD is creating a nice head and shoulders formation and we are very close to the neckline. A breakout here should trigger a sell signal with a potential target 560 pips lower! Definitely the place to be for every trader but do not go too early. For a proper signal, we need to see a breakout of the neckline first.
Yesterday, the GBPJPY pair created a great sell setup. We had everything. The price broke the upwards trend line, created a bearish wedge, bounced from the resistance, and made a head and shoulders pattern. We broke the lower line of the wedge and the neckline. In other words, it was the ultimate sell signal. It was a dream come true for every price action trader. But guess what? Today, the price is trading higher. Sometimes things like this happen, so you should always have a stop loss order. If the day closes above the neckline, the sell signal will be denied.