GBP/USD Retreats As Dark Cloud Cover Formation Offers Warning Signal
- GBP/USD Technical Strategy: pending short
- Dark Cloud Cover formation in intraday trade offers warning
- Shooting Star looks to be forming on the daily
GBP/USD is giving back some ground after staging an exceptional run to its 2014 high near 1.6820 in recent trading. The retreat by the bulls looks to be prompting a Shooting Star pattern to form during intraday trade. However, the candle has yet to close and receive confirmation from a successive down period before being validated.
GBP/USD: Bulls Make A Run on 2014 High
Daily Chart - Created Using FXCM Marketscope 2.0
Examining intraday price action using the four hour chart below; there are signs the bears are re-emerging. A Dark Cloud Cover formation near resistance at 1.6815 is suggesting a potential dip towards 1.6750 in the session ahead.
GBP/USD: Dark Cloud Cover Offers Warning
4 Hour Chart - Created Using FXCM Marketscope 2.0
This week’s gains for the pound have acted to negate the Dark Cloud Cover formation that had appeared near multi-year resistance for GBP/USD. The rally has arisen following a Piercing Line pattern which signaled the bulls were returning to the Cable.
GBP/USD: Bulls Return As Piercing Line Forms on Weekly
Weekly Chart - Created Using FXCM Marketscope 2.0
By David de Ferranti, Market Analyst, FXCM
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