GBP/USD Technical Analysis: Clinging to Support Below 1.70
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- GBP/USD Technical Strategy: Flat
- Support: 1.6969, 1.6905, 1.6832
- Resistance:1.7053, 1.7176, 1.7319
The British Pound is digesting last week’s losses having turned lower as expected against the US Dollar after showing a Hanging Man candle with negative RSI divergence. Near-term support is at 1.6969, the 23.6% Fibonacci retracement. A break below that on a daily closing basis exposes a rising trend line set from early February, now at 1.6905. Alternatively, a reversal above the 14.6% Fibat 1.7053 opens the door for a test of 1.7176, the July 2 top.
Risk/reward considerations argue against entering short with prices trading in close proximity to support. On the other hand, the absence of a defined bullish reversal signal suggests taking up the long side is premature. We will remain flat for now.
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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.