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- GBP/USD Technical Strategy: Flat
- Support: 1.6296, 1.6215, 1.6113
- Resistance:1.6378, 1.6459-79, 1.6542
The British Pound continues to face heavy selling pressure, with prices sliding to the lowest level in seven months against the US Dollar. Near-term support is at 1.6296, the 50% Fibonacci expansion, with a break below that on a daily closing basis exposing the 61.8% level at 1.6215. Alternatively, a reversal above the 38.2% Fib at 1.6378 clears the way for a challenge of the 1.6459-79 area marked by the March 24 low and the 23.6% expansion.
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.
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Daily Chart – Created Using FXCM Marketscope 2.0
— Written by Ilya Spivak, Currency Strategist for DailyFX.com