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GBPUSD Candlestick Reversal Signal Off Resistance – 4

gbpusd h4

One of the War Room members spotted this setup and I thought I would share it.

The 4 hour chart on the GBPUSD shows a clear resistance level which price has failed to push through on 3 attempts.

The last test of this resistance caused a strong reaction by the bulls, heavily rejecting higher prices and forcing the candle to close lower than the open price.

Now we’ve got a strong bearish rejection candle reversal signal off this resistance level, signalling that prices want to move lower. The anatomy of the candle is also very strong, with the body being so thick on the bearish side, really giving the setup that extra aggressiveness.

 

NICE BEARISH SELL OFF RESPONSE FROM BEARISH REJECTION

gbpusd 4 hour sell off

 

The market followed through very nicely off the bearish rejection candle signal that we just covered recently, giving price action swing traders the opportunity to bank some good returns.

Because  the move was so aggressive, a bearish outside candle as printed on the daily chart as a result.

gbpusd b ouside candle

 

Now the daily chart also looks quite bearish, with a nice mean looking bearish outside candle sitting right there on a swing level.

If price breaks the low of the outside candle this week, we could see a much more deeper move into lower prices.

Dale Woods

Dale Woods

The Forex Guy is an educational Forex trading blog run by Dale Woods who has been a passionate retail Forex trader for over 6 years. Dale trades the Forex market exclusively with price action based methodologies, believing price action trading to be one of the powerful approaches used the market today, and really is the core foundation of any good trading system. Dale also strongly believes in keeping charts clean and keeping things simple, logical and uncomplicated. By making trading decisions straight off the raw price action data, you can ‘bypass’ unnecessary variables like exotic indicators, trading robots or magical pivot levels. Dale enforces the idea that there is hardly any edge trading news and economic data releases and much prefers to make trading decisions straight from the candlestick themselves. ‘The Forex Guy’ is dedicated to providing knowledge to serious and passionate traders who want to learn the art of price action trading, positive geared money management and how to psychologically condition themselves to become a professional trader.