gbp/usd 2nd update 1-19-09

The 4hr bar that just closed at 0800 gmt (3:00am est) closed as a bearish reversal bar.A short entry is signaled on a pullback to 4825 as per video update.Instead of entry at the daily single bar resistance level of 4825 (which is a valid entrybecause it is a resistance level.

The safer entry to shorten your stop would be the open priceof bar A 4870 with stop above the high of bar A which is 4907.

An even better stop would be the high of bar 1 because it is the high of the last upswing.
You can see that we are bouncing off daily single bar support. and at the time of this writinglooks to be bouncing back up to test the reversal bar and overhead resistance at bar A.

You should always anticipate a bounce off a support or resistance level. Especially it the levelhas not yet been tested.

If the entry is hit then here is what you do from here. At the end of each 4hr period check to see if yourtake profit or stop has been hit. If neither has been hit you determine if the last 4hr bar closed weak.

If it closed weak you want to get out early with whatever profit or loss you have at that time.Also the signal is only in effect for the current 4hr period. If an entry has not been hit the tradeis canceled.

Cheers, Jerry