Forex: GBP/USD Technical Analysis – Waiting to Re-Enter Short
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- GBP/USD Technical Strategy: Flat
- Support: 1.6593 (23.6% Fib ret.), 1.6452 (38.2% Fib ret.)
- Resistance: 1.6742 (Feb 14 close), 1.6785 (38.2% Fib exp.)
The British Pound continues to wait for defined direction cues against the US Dollar, with prices stalling above support at 1.6593 marked by the 23.6% Fibonacci retracement. Near-term resistance is at 1.6742, marked by the February 14 close and a recently broken rising trend line. A break above that aims for the 38.2% Fib expansion at 1.6785. Alternatively, a turn below support aims for the 38.2% retracement at 1.6452.
We booked profits on half of our short GBP/USD trade yesterday and the rest was stopped out at breakeven on the upward spike over the past 24 hours. Our fundamental view favors Sterling weakness but re-entering short is not attractive from a risk/reward perspective at this point as prices hover just above support. We will stand aside for now until another entry opportunity presents itself.
Daily Chart - Created Using FXCM Marketscope 2.0
--- 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.