GBP/USD Reclaims Lost Ground On The Back Of A Piercing Line Pattern

By DailyFx | August 29, 2014 AAA

DailyFX.com -

Talking Points

  • GBP/USD Technical Strategy: Sidelines Preferred
  • Piercing Line Pattern May Find Limited Follow-Though
  • Climb Over 1.6660 Needed To Suggest A Small Base

GBP/USD continues its cautious recovery which follows the appearance of a Piercing Line formation near the 1.6526 floor. Yet the bullish reversal pattern may struggle to yield a sustained recovery against the backdrop of a core downtrend. This leaves selling into rallies preferred at this point. A daily close above 1.6660 would be required to warn of a small base and the potential for a sustained recovery.

GBP/USD: Piercing Line Pattern May See Limited Follow-Through

GBP/USD Reclaims Lost Ground On The Back Of A Piercing Line Pattern

Daily Chart - Created Using FXCM Marketscope 2.0, Volume Indicator Available Here

The four hour chart leaves few directional signals for GBP/USD. A narrow range appears to have formed with short body candles indicating indecision amongst traders. Based on the bearish backdrop from the daily selling into corrective bounces would be preferred.

GBP/USD: Short Body Candles Suggest Conviction Lacking

GBP/USD Reclaims Lost Ground On The Back Of A Piercing Line Pattern

4 Hour Chart - Created Using FXCM Marketscope 2.0, Volume Indicator Available Here

By David de Ferranti, Currency Analyst, DailyFX

Follow David on Twitter: @Davidde

To receive David’s analysis directly via email, please sign up here.

Learn how to read candlesticks to help identify trading opportunities with the DailyFX Candlesticks Video Course.

comments powered by Disqus
Related Forex Analysis
  1. GBP/USD recovering from Asian lows
    Forex News

    GBP/USD recovering from Asian lows

  2. USD/JPY mellow on the back of USD sell-off
    Forex News

    USD/JPY mellow on the back of USD sell-off

  3. Dollar Cheered in Press, But Data and Fed Chatter Turning
    Forex News

    Dollar Cheered in Press, But Data and Fed Chatter Turning

  4. EUR/USD Downside Targets Favored Ahead of ECB on Slowing Inflation
    Forex News

    EUR/USD Downside Targets Favored Ahead of ECB on Slowing Inflation

  5. US Dollar Technical Analysis: Is a Pullback in the Cards?
    Forex News

    US Dollar Technical Analysis: Is a Pullback in the Cards?

Trading Center