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GBP/USD Bearish Candlestick Fails To Find Confirmation Near Key Support

GBP/USD Bearish Candlestick Fails To Find Confirmation Near Key Support

2014-05-06 11:49:00
David de Ferranti, Currency Analyst
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Talking Points

  • GBP/USD Technical Strategy: Longs Preferred
  • Hammer finds little-follow through following test of support
  • Dark Cloud Cover suggests selling pressure near 1.6900

GBP/USDgave back some of its recent gains prompting the emergence of a Hanging Man formation on the daily. However, the reversal pattern has failed to find follow-through given the strong buying support at the prior breakout point at 1.6870. With a reversal signal now seemingly lacking, the pair may be primed to push towards its August 2009 high at 1.7040.

GBP/USD: Buyers Emerge Near Key Support

GBP/USD Bearish Candlestick Fails To Find Confirmation Near Key Support

Daily Chart - Created Using FXCM Marketscope 2.0

Intraday price action on the four hour chart suggests sellers are likely sitting at the 1.6900 handle. This is made evident by the Dark Cloud Cover formation that arose on the last test of the psychologically-significant level. Longs may be better served on a break higher.

GBP/USD: Faces Test of Key Resistance At 1.6900

GBP/USD Bearish Candlestick Fails To Find Confirmation Near Key Support

4 Hour Chart - Created Using FXCM Marketscope 2.0

By David de Ferranti, Market Analyst, DailyFX

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