GBP/USD Technical Analysis: Down Trend Reversal at Hand?
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- GBP/USD Technical Strategy: Flat
- Support: 1.5540, 1.5447, 1.5213
- Resistance: 1.5701, 1.5825, 1.5930
The British Pound is edging upward against the US Dollar as expected following the appearance of a bullish Piercing Line candlestick pattern. Near-term resistance is at 1.5701, a falling trend line set from mid-July, with a break above that on a daily closing basis exposing the November 27 high at 1.5825. Alternatively, a turn below the December 8 low at 1.5540 opens the door for a challenge of the 23.6% Fibonacci expansion at 1.5447.
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
--- Written by Ilya Spivak, Currency Strategist for DailyFX.com