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Talking Points:
- GBP/USD Technical Strategy: Short at 1.4926
- Support: 1.4696, 1.4431, 1.4167
- Resistance: 1.4830, 1.5023, 1.5224
The British Pound continues to consolidate losses against the US Dollar having declined as expected after showing a Bearish Engulfing candlestick pattern. Near-term support is at 1.4696, the 38.2% Fibonacci expansion, with a break below that on a daily closing basis exposes the 50% level at 1.4431. Alternatively, a turn above support-turned-resistance at 1.4830 – a double bottom established between March and July 2013 – opens the door for a challenge of the 1.4950-1.5023 area (January 23 low, 23.6% Fib).
We sold GBPUSD at 1.4926, initially targeting 1.4696. A stop-loss will be activated on a daily close above 1.5136. We will take profit on half of the trade and move the stop-loss to the breakeven level once the first target is reached.
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Daily Chart - Created Using FXCM Marketscope
--- Written by Ilya Spivak, Currency Strategist for DailyFX.com
