GBP/USD Technical Analysis: Five-Month Down Trend at Risk
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- GBP/USD Technical Strategy: Flat
- Support: 1.5277, 1.5188, 1.5000
- Resistance: 1.5359, 1.5479, 1.5806
The British Pound vaulted sharply higher against the US Dollar, with buyers moving to challenge resistance guiding the down trend since mid-September. Channel top resistance is at 1.5359, with a break above that on a daily closing basis exposing the 23.6% Fibonacci retracement at 1.5479. Alternatively, a reversal below the 14.6% level at 1.5277 clears the way for a test of shorter-term channel resistance-turned-support at 1.5188.
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 long 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
--- 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.