GBP/USD Technical Analysis: Candle Setup Hints at Upswing
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- GBP/USD Technical Strategy: Flat
- Support: 1.5533, 1.5280, 1.5285
- Resistance: 1.5725, 1.5809, 1.5945
The British Pound may be preparing to correct higher against the US Dollar after prices produced a bullish Morning Star candlestick pattern. A daily close above the 14.6% Fibonacci retracementat 1.5725 exposes the 23.6% level at 1.5809. Alternatively, a turn below the 1.5533-87 area marked by the November 19 low and the 100% Fib expansion clears the way for a test of the 123.6% threshold at 1.5380.
Risk/reward considerations argue against entering long with prices in close proximity to resistance. On the other hand, the absence of a defined bearish reversal signal suggests taking up the short side is premature. We will remain flat for now, waiting for a more actionable opportunity to present itself.
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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.