GBPUSD: Long term Sell Opportunity.

GBPUSD is trading inside a Channel Down since the April 2018 high and at the moment is near the Lower High zone (RSI = 40.872, MACD = -0.027, Highs/Lows = -0.0056). We remain short on this pair but in order to decide whether to hold our position for the longer term or not we looked further back into its historical patterns.

As you see on the chart we found a similar price behavior on the 1W candle action back in the 1900s and early 2000s. The pair was again trading within a decade long Falling Wedge that only broke when a Golden Cross formation emerged on the 1W chart. Up until now the candle action is almost the same:

1) Sharp fall from the initial High of the Falling Wedge to the first Low,
2) Followed by a multi year volatile period when the MA50 and MA200 were on parallel courses
3) Death Cross that initiated the next Lower Low

So our conclusion is that as long as no Golden Cross takes place on 1W, GBPUSD will remain a short option. We are only willing to reverse to a long term buy position if the Golden Cross emerges. Until then the suggested Target Zone is 1.1500 - 1.0850.






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