GBP/USD Technical Analysis: Pivotal Trend Line in Focus
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- GBP/USD Technical Strategy: Flat
- Support: 1.4798, 1.4709, 1.4597
- Resistance: 1.4847, 1.4990, 1.5058
The British Pound advanced as expected against the US Dollar following the appearance of a bullish Piercing Line candlestick pattern. A daily close above trend line support-turned-resistance at 1.4847 exposes the 1.4942-90 area (38.2% Fibonacci retracement, horizontal pivot). Alternatively, a reversal below the 23.6% Fib at 1.4798 clears the way for a test of the 14.6% retracement at 1.4709.
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