GBP/USD Technical Analysis: Waiting for Short Trade Setup
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- GBP/USD Technical Strategy: Flat
- Support: 1.6348, 1.6255, 1.6088
- Resistance: 1.6486, 1.6621, 1.6755
The British Pound appears poised to continue higher against the US Dollar after breaking resistance capping gains since mid-July. Buyers now aim to challenge the 1.6459-86 area marked by the March 24 low and the 38.2% Fibonacci retracement, with a break above that on a daily closing basis exposing the 50% level at 1.6621. Alternatively, a turn back below the trend line – now at 1.6348 – clears the way for a challenge of the 23.6% Fib expansion at 1.6255.
The dominant longer-term GBPUSD trend has favored the downside since mid-July when the 12-month advance initiated below 1.49 that took prices above 1.71 was overturned. With that in mind, we will look to any on-coming gains as a correction offering a selling opportunity rather than a reason to be long. Absent an actionable sell signal in the interim, we will stand aside.
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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.