GBP/USD Technical Analysis: Readying to Move Below 1.51?
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- GBP/USD Technical Strategy: Flat
- Support: 1.5121, 1.4976, 1.4888
- Resistance: 1.5265, 1.5354, 1.5498
The British Pound moved lower against the US Dollar as expected after putting in a bearish Dark Cloud Cover candlestick pattern. Near-term support is at 1.5121, the 38.2% Fibonacci expansion, with a meaningful break below that exposing the 1.4976-1.5004 area (38.2% level, range top resistance-turned-support). Alternatively, a reversal above the 23.6% Fib at 1.5265 opens the door for a challenge of the 14.6% Fib at 1.5354.
Risk/reward considerations argue against entering short with prices in close proximity to support. On the other hand, the absence of a defined bullish reversal signal suggests taking up the long side is premature. We will remain flat for now, waiting for an 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.