GBP/USD Candlestick Analysis: 7-Month Down Trend Broken
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- GBP/USD Strategy: Long from 1.5373
- Seven-Month Down Trend Looks Broken
- Weekly Resistance Seen Just Below 1.55
The British Pound overturned its seven-month down trend against the US Dollar after prices put in an Inverted Hammer candlestick near the 1.50 figure. Confirmation of reversal followed on a break above 1.5277, the intersection of the 14.6% Fibonacci retracement and the top of a falling channel guiding the multi-month down move. The next layer of weekly resistance comes in at 1.5479, the 23.6% level, with a break above that exposing the 38.2% Fib at 1.5806.
From a longer-term perspective, prices are pace to produce the first monthly advance after seven consecutive periods of losses. That may mark the first step in resuming the choppy rising trend from the post-crisis lows set in January 2009.
Weekly Chart - Created Using FXCM Marketscope
--- Written by Ilya Spivak, Currency Strategist for DailyFX.com
DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.