GBP/USD Technical Analysis: Wedge Setup Hints at Bounce
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- GBP/USD Technical Strategy: Flat
- Support: 1.5773, 1.5679, 1.5523
- Resistance: 1.5995, 1.6120, 1.6324
The British Pound may be building toward an upside reversal against the US Dollar as prices trace out a Falling Wedge chart formation. Near-term resistance is at 1.5995, the Wedge top, with a break above that on a daily closing basis exposing the 23.6% Fibonacci retracement at 1.6120. Alternatively, a turn below the Wedge floor at 1.5773 opens the door for a challenge of the 38.2% Fib expansion at 1.5679
Prices are too close to resistance to justify entering long from a risk/reward perspective. On the other hand, the absence of a defined bearish reversal signal suggests that taking up the short side is premature. With that in mind 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.