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Forex: GBP/USD Technical Analysis – Holding Short Below 1.68 Mark

Forex: GBP/USD Technical Analysis – Holding Short Below 1.68 Mark

2014-03-07 01:24:00
Ilya Spivak, Head Strategist, APAC

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Talking Points:

  • GBP/USD Technical Strategy: Short at 1.6710
  • Support: 1.6593 (23.6% Fib ret.), 1.6452 (38.2% Fib ret.)
  • Resistance: 1.6742 (Feb 14 close), 1.6800 (38.2% Fib exp.)

We entered short GBP/USD yesterday looking for prices to decline after they produced a Bearish Engulfing candlestick pattern below resistance at 1.6742, the February 14 close. Our initial objective is 1.6593, the 23.6% Fibonacci retracement. A break below this level on a daily closing basis exposes the 38.2% retracement at 1.6452. Alternatively, a reversal above 1.6742 exposes the 38.2% Fib expansion at 1.6800. The setup is little-changed from the time we initiated the position and we will continue to hold it for the time being. A stop-loss is to be activated on a daily close above 1.6822, the February 17 high.

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dailyclassics_gbp-usd_body_Picture_12.png, Forex: GBP/USD Technical Analysis – Holding Short Below 1.68 Mark

Daily Chart - Created Using FXCM Marketscope 2.0

--- Written by Ilya Spivak, Currency Strategist for DailyFX.com

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