GBP/USD Bulls Hold Back As Shooting Star Pattern Emerges
- GBP/USD Technical Strategy: Longs Preferred
- Shooting Star suggests bulls reluctant to push higher
- Dark Cloud Cover denotes indecision near 1.6900
GBP/USDhas given back some of its recent gains prompting the emergence of a Shooting Star formation on the daily. While the short length of the wick does little to inspire confidence in the potential for a reversal, it shows some hesitation from the bulls. Additionally, the pattern needs to see confirmation from a second down-day before suggesting the potential for a correction. This leaves longs preferred at this stage, with the potential for a run on the August 2009 high near 1.7040.
Traders should be mindful of the potential for a surprise US Non-Farm Payrolls reading in the coming hours to spark significant volatility for US Dollar based pairs. The release of the figures will be covered live in DailyFX Plus.
Daily Chart - Created Using FXCM Marketscope 2.0
Intraday price action on the four hour chart similarly demonstrates some reluctance from traders. This is made evident by the Dark Cloud Cover formation near the psychologically-significant 1.6900 handle.
GBP/USD: Bulls Take A Breather As Dark Cloud Cover Forms
4 Hour Chart - Created Using FXCM Marketscope 2.0
By David de Ferranti, Market Analyst, DailyFX
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