The Bulls are staying on the Sidelines with the Sterling

GBP/USD (1.5700)

I have been watching the GBP/USD with some interest over the last several week. There has been no sign of a strong turnaround, and no clear sign of the Sterling continuing to move south. Basically we are stuck between two key technical levels. Please refer to my above MT 4 daily chart.

Technically speaking we are noting a Doji form. This is a sign buyers are hesitating and remaining on the sideline. This is another reason why we should not have strong confidence in a recovery. This also reinforces the morning star we see at the current price level. Couple this with the short term bearish trend, I remain focus on support levels. More specifically, 1.5590 then the stronger support level at 1.5585. Should we have a daily close below the latter level then we will challenge 1.5420 and lower. I want to point out we have the August 2013 low at 1.5425. Hopefully this will hold.

Taking a look at my 4 hour MT 4 chart below, we see a similar picture to the above daily chart. There are many Dojis indicating hesitation as buyers and sellers remained unconvinced. I will keep my strategy, for now, the same. I have a short position open targeting 1.5460. I have a stop at breakeven at 1.5769.

As always, trading strategies are educational and do not constitute trading advice. Always do your own technical analysis to support mine.