If you are looking for trend deals then you are in the right place!
It looks like GBP/USD is ready to bounce from the ascending support channel while the US dollar bounced lower from the resistance area.
What setup are you most likely to trade?
US Dollar Index (DXY) 1-hour forex chart by TradingView
Is the US dollar ready for a long-term reversal? The US Dollar Index (DXY) has just been rejected from the 102.75 area, which is lined up with an ascending resistance channel on the 1-hour time frame.
Rejection at resistance opens doors for retesting channel support near 102.15 area.
As you can see, the channel support is not too far away from the 100 and 200 SMAs on the chart. In fact, the 100 SMA also looks ready for a bullish crossover with the 200 SMA!
DXY has not reached its trendline support yet, so you still have time to formulate trading plans if you are betting on a sustained uptrend for the dollar.
Of course, you can also take advantage of the current pullback and trade the DXY move lower until we see more sustained buying pressure near lower inflection points.
GBP/USD 4-hour chart by TradingView
Swing Traders Rally!
The pound just bounced from the psychological level of 1.2350 which is aligned with the 4-hour chart’s 100 SMA and a rising support channel that has not been breached since late March.
How high can the GBP/USD pair fly?
A long trade at current levels will still yield a good reward-to-risk ratio especially if you place your stops below the channel and target previous GBP/USD highs or new monthly highs.
Aren’t you convinced that GBP/USD can sustain its bullish trend?
You can also place orders below channel support and bet on a possible bearish breakout.
Just be sure to use appropriate volatility stops so you don’t make a fake mistake!