GBP/USD Technical Analysis: Pivotal Trend Line Under Fire

By DailyFx | Updated July 30, 2014 AAA

DailyFX.com -

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

Talking Points:

  • GBP/USD Technical Strategy: Flat
  • Support: 1.6914, 1.6832, 1.6721
  • Resistance:1.6969, 1.7053, 1.7176

The British Pound continues to edge downward against the US Dollar having marked a top as expected after showing a Hanging Man candle with negative RSI divergence. Near-term support is at a rising trend line set from early February, now at 1.6914. A break below that on a daily closing basis exposesthe 38.2% Fibonacci retracement at 1.6832.Alternatively, a reversal above the 23.6% level at 1.6969opens the door for a test ofthe 14.6% Fib at 1.7053.

Risk/reward considerations argue against entering short with prices trading 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.

Add these technical levels directly to your charts with our Support/Resistance Wizard app!

GBP/USD Technical Analysis: Pivotal Trend Line Under Fire

Daily Chart - Created Using FXCM Marketscope 2.0

Related Forex Analysis
  1. GBP/USD Technical Analysis: H&S Bottom May Yet Form
    Forex News

    GBP/USD Technical Analysis: H&S Bottom May Yet Form

  2. Disinflation driving monetary divergence - SocGen
    Forex News

    Disinflation driving monetary divergence - SocGen

  3. Session Recap: Artificial growth does not feed the USD
    Forex News

    Session Recap: Artificial growth does not feed the USD

  4. GBP/USD flew above 1.6000, but it was forced to land
    Forex News

    GBP/USD flew above 1.6000, but it was forced to land

  5. GBP/USD Rally Rejected at Trendline
    Forex News

    GBP/USD Rally Rejected at Trendline

Trading Center