Trade FOREX with FXCM

  • Award-Winning Platform
  • 24/7 Customer Support
  • Trade Directly on Charts
  • Free $50K Practice Account

Resources

Forex: GBP/USD Technical Analysis – Selloff Loses Steam Above 1.62

By , Currency Strategist
07 February 2014 08:10 GMT

To receive Ilya's analysis directly via email, please SIGN UP HERE

Talking Points:

  • GBP/USD Technical Strategy: Flat
  • Support: 1.6260 (50% Fib ret.), 1.6164 (61.8% Fib ret.)
  • Resistance: 1.6356 (38.2% Fib ret.), 1.6448 (channel bottom)

The British Pound weakened against the US Dollar as expected after prices produced a Bearish Engulfing candlestick pattern. The pair is treading water above support at 1.6260, the 50% Fibonacci retracement, with a break lower on daily closing basis targeting the 61.8% level at 1.6164. Alternatively, a reversal above the 38.2% Fib at 1.6356 exposes a rising channel bottom set from set from mid-December at 1.6448.

Three back-to-back indecision candles after a sharp selloff point to ebbing bearish momentum, hinting a bounce may be ahead. While this warns against betting on downward continuation, the absence of confirmation likewise suggests it is premature to enter long. We will remain flat for the time being.

Confirm your chart-based trade setups with the Technical Analyzer. New to FX? Start Here!

dailyclassics_gbp-usd_body_Picture_12.png, Forex: GBP/USD Technical Analysis – Selloff Loses Steam Above 1.62

Daily Chart - Created Using FXCM Marketscope 2.0

--- Written by Ilya Spivak, Currency Strategist for DailyFX.com

DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.
Learn forex trading with a free practice account and trading charts from FXCM.

07 February 2014 08:10 GMT