Forex: GBP/USD Technical Analysis – Short Trade Making Progress

Ilya Spivak
March 11, 2014

To receive Ilya's analysis directly via email, please SIGN UP HERE

Talking Points:

  • GBP/USD Technical Strategy: Short at 1.6710
  • Support: 1.6593 (23.6% Fib ret.), 1.6452 (38.2% Fib ret.)
  • Resistance: 1.6690 (trend line), 1.6742 (Feb 14 close)

We entered short GBP/USD at 1.6710 after prices put in a Bearish Engulfing candlestick pattern below resistance at 1.6742, the February 14 close. Negative RSI divergence has reinforced the probability for a downside scenario. Prices have started to make progress downward, taking out minor rising trend line support to clear a path to our initial objective at 1.6593, the 23.6% Fibonacci retracement. A daily close below this barrier will expose the next objective at 1.6452, the 38.2% level. Alternatively, a turn back above the trend line (now at 1.6690) aims for 1.6742 anew. We continue to hold, with a stop-loss set to activate a daily close above the February 17 high at 1.6822.

Confirm your chart-based trade setups with the Technical Analyzer. New to FX? Start Here!

dailyclassics_gbp-usd_body_Picture_12.png, Forex: GBP/USD Technical Analysis – Short Trade Making Progress
dailyclassics_gbp-usd_body_Picture_12.png, Forex: GBP/USD Technical Analysis – Short Trade Making Progress

Daily Chart - Created Using FXCM Marketscope 2.0

--- 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.
Learn forex trading with a free practice account and trading charts from FXCM.