Forex Marketz Daily Forex News – Fully Markets Update
GBP/USD (1.5766)
Three points to consider:
- Sterling breaks through 1.57, sellers now aim for the June high
- Larger price action trend remains bearish
- Trade Strategy: Stand Aside
The GBP/USD Forex market has broken out of its consolidation pattern to the upside. The Sterling has now broken the long held 1.57 barrier as traders aim for the June high. Please refer to the below GBP/USD daily MT 4 chart for today’s technical analysis.
Technical Analysis
Let’s discuss today’s technical analysis for the GBP/USD Forex pair. The Sterling has broken higher from its congestion range. We had been stuck here for two months as the GBP/USD wandered here. There is no long position at this time. The Sterling has lagged behind other major Forex partners over the recent months when compared to their recent comebacks versus the US Dollar. The underlying strength of this GBP bounce higher is suspect even as the Dollar is falling to multi month lows against other top trading partners.
Trade Strategy
A trade strategy for today is complicated from a technical standpoint. Long term dynamics, from the charts, demands our attention. The GBP/USD moved lower for seven months in a row after the Sterling hit its high in July of 2014. The Sterling then hit a bottom in early 2015 to attempt this recent recovery. The last time this happened, in the second half of 2008, the Sterling saw a corrective bounce higher of almost 26 percent. Looking at this current correction higher, the GBP has only gained about 10 percent. This puts this current bounce higher barely in a correction mode higher as traders should eye a point for a short GBP trade, in line with the larger GBP bearish trajectory. Right now there is no actionable trade setup and I will remain flat for today in the GBP/USD Forex market.
