GBP/USD Technical Analysis: Rally Extends for Third Day
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- GBP/USD Technical Strategy: Flat
- Support: 1.5464, 1.5352, 1.5170
- Resistance: 1.5647, 1.5794, 1.5941
The British Pound advanced against the US Dollar as expected after putting in a Bullish Engulfing candlestick pattern. Near-term resistance is at 1.5647, the38.2% Fibonacci expansion, with a break above that on a daily closing basis exposing the 50% level at 1.5794. Alternatively, a reversal below the 23.6% Fib at 1.5464 clears the way for a test of trend line resistance-turned-support at 1.5311.
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 short side is premature. We will remain flat for now, waiting for an actionable opportunity to present itself.
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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.