GBP/USD Technical Analysis: Waiting to Enter Short Trade
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- GBP/USD Technical Strategy: Flat
- Support: 1.5464, 1.5289, 1.5170
- Resistance: 1.5647, 1.5794, 1.5941
The British Pound moved higher against the US Dollar as expected after producing a Bullish Engulfing candlestick pattern. A daily close above the38.2% Fibonacci expansionat 1.5647 exposes the 50% level at 1.5794. Alternatively, a turn below the 23.6% Fib at 1.5464 opens the door for a challenge of trend line resistance-turned-support at 1.5289.
A long trade is tempting from a purely technical perspective but we will tactically opt to stand aside. Longer-term positioning seems to broadly favor USD strength against the Pound, suggesting any on-coming gains are likely to be corrective. With that in mind, we will wait until the upswing yields a selling opportunity.
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--- 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.