Forex Technical Update
- Pullback Confirms Bearish Intent:
- The GBP/USD found resistance at the 1.6450 pivot, which was near the 200SMA in the 1H chart as well.
- The RSI failed to sustain a break back above 60, and fell back below 30.
- This suggests bearish continuation in the short-term.
- We are right now at 61.8% retracement of yesterday's rally.
- Below 1.63, we should be attacking the 1.6260, then 1.6210 levels.
- We might get some drying of volatility until the FOMC meeting minutes are released at 2:00PM ET.
- Really its all noise until the market either breaks above 1.6530 to signal a bullish continuation towards 1.6618, then 1.6745;
- OR, more likely, a break below 1.62 to signal a decline to 1.6110, and then 1.60.
- As the market is attempting to crack 1.63, there is a bearish bias in the short-term towards 1.6210.
- The 4H chart shows that if the market breaks back below 1.62, we are in a bearish breakout of a rising trendline, given further impetus for the bearish scenario to 1.6110, 1.60.
- Candlestick analysis of the sharp bearish push after the slow pullback also suggests the bears are in charge.
Fan Yang CMT
Chief Technical Strategist