Insight
Short

GBPUSD:Price reverses direction after testing a resistance level

FX_IDC:GBPUSD   BRITISH POUND / U.S. DOLLAR
I predict GBPUSD             to reverse in direction into a downtrend. This is suggested by the trend line which goes through the swing highs, and the strong resistance level at 1.5688. This resistance level was clearly tested in the morning of 17th August which, overall, gives it a much higher significance in the market's direction.

The Relative Strength Index indicates that the market was overbought which supports my prediction of a trend reversal into a downtrend. The bearish failure swing also supports my prediction of a short trade. Moreover, the current candlestick pattern of a bearish marubozu suggests the market's bearish nature.

It is possible for the GBP to now break through the 0.500 or even 0.382 retracement level, so it is difficult to estimate where a suitable take profit should be set up - it all depends on how bearish the GBP becomes. In case my prediction turns out to be incorrect, a stop loss right above the 1.5688 resistance level will be most suitable. If that does happen, the strong resistance may become a support and it could be a long trade thereafter.

Stop Loss: 1.5696
Take Profit: 1.5635
Risk/Reward Ratio: 1.77
English
English (UK)
English (IN)
Deutsch
Français
Español
Italiano
Polski
Türkçe
Русский
Português
Bahasa Indonesia
Bahasa Melayu
ภาษาไทย
Tiếng Việt
日本語
한국어
简体
台灣
Home Stock Screener Forex Signal Finder Cryptocurrency Signal Finder Economic Calendar How It Works Chart Features House Rules Moderators Website & Broker Solutions Widgets Stock Charting Library Feature Request Blog & News FAQ Help & Wiki Twitter
Profile Profile Settings Account and Billing My Support Tickets Contact Support Ideas Published Followers Following Private Messages Chat Sign Out