GBPUSD Key Reversal Signal Awaits Confirmation
- GBP/USD Technical Strategy: Longs Preferred
- Hammer requires confirmation before suggesting reversal
- Dark Cloud Cover denotes indecision near 1.6900
GBP/USDhas given back some of its recent gains prompting the emergence of a Hanging Man formation on the daily. However, the reversal 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 possibility of a run on the August 2009 high near 1.7040.
Daily Chart - Created Using FXCM Marketscope 2.0
Intraday price action on the four hour chart similarly demonstrates some reluctance from traders to push higher. This is made evident by the Dark Cloud Cover formation near the psychologically-significant 1.6900 handle. However, the Piercing Line pattern suggests the bulls haven’t abandoned the Pound just yet.
GBP/USD: Piercing Line Pattern Prompts Intraday Bounce
4 Hour Chart - Created Using FXCM Marketscope 2.0
By David de Ferranti, Market Analyst, DailyFX
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