Strategy: Pending Short

GBPUSD sold off after putting in a Harami pattern below major trend line resistance that has capped the upside since late April 2011. Prices are now testing through the former top of a wedge pattern now recast as support to challenge the 38.2% Fibonacci retracement at 1.6116, with a break below that exposing 1.6059. Risk/reward considerations argue against entering short at current levels and we will stand aside for now.

GBPUSD_Waiting_for_Short_Entry_Opportunity_body_Picture_5.png, GBPUSD: Waiting for Short Entry Opportunity

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

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