GBP/USD—The Pound is Digesting Losses below 1.50

GBP/USD (1.4764)

• Resistance Levels: 1.4830, 1.5022, 1.5223
• Support Levels: 1.4695, 1.4430, 1.4168
• Trade Strategy: Short at 1.4925, initial target 1.4695

The GBP is trading below 1.50 quietly after turning lower against the US Dollar. See the below daily MT 4 chart and note the bearish Engulfing Candlestick then the turn lower.

A daily close below 1.4696 will challenge the next technical support at 1.4430. Should the GBP/USD turn higher, we need a break above 1.4830, a former support level, to challenge the technical resistance at 1.4430. Please note that 1.4830 is the double bottom. A close above this level could see a move towards the cluster zone at 1.4950 to 1.5022.

I have a short opened at 1.4925. My initial target is 1.4695. A stop loss is at 1.5135. After booking half the gains on this short, I will move the stop loss to breakeven.