GBP/USD Technical Outlook:
- Cable continues to maintain its upward trajectory on the daily
- Dialing in the 4-hr chart there is a wedge that could soon break
GBP/USD technical guides to watch
Cable has been maintaining an upward trajectory since October, albeit a choppy one. Broadly speaking GBP/USD is above significant long-term resistance at 13500 within the confines of a channel. This keeps the pair pointed higher until the lower parallel and 13500 are breached.
In the shorter-term as Cable sits near the top of the channel on the daily, on the 4-hr chart there is a clean wedge nearing the point of breaking. In the event price breaks the top trend-line of the pattern, then we could see GBP/USD make a push out of the channel as well. This would best position it for a strong rise from here.
On the flip-side, we could see a breakdown below the lower trend-line of the wedge pattern. This would turn the near-term outlook bearish, but we would need to keep in mind that not too far below lies the 13500 level as well as the lower parallel of the channel since October.
Overall, the outlook in the near-term hinges on what happens with the wedge. Looking further out we have both a technical structure (channel) and a big horizontal level (13500) to keep us guided as to whether the broad trading bias should remain generally bullish or bearish.
GBP/USD Daily Chart (Channeling Above 13500)
GBP/USD 4-hr Chart (wedge)
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---Written by Paul Robinson, Market Analyst
You can follow Paul on Twitter at @PaulRobinsonFX
