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Talking Points:
- GBP/USD Technical Strategy: Flat
- Support: 1.5549, 1.5459, 1.5349
- Resistance: 1.5639, 1.5750, 1.5818
The British Pound turned lower against the US Dollar as expected after putting in a bearish Evening Star candlestick pattern. A daily close below the1.5549-74 area (50% Fibonacci retracement, trend line) exposes the 61.8% level at 1.5460. Alternatively, a turn above the 38.2% Fib at 1.5639 opens the door for a challenge of the 23.6% retracement at 1.5750.
Prices are too close to support to justify entering short from a risk/reward perspective. On the other hand, the absence of a defined bullish reversal signal suggests that taking up the long side is premature. With that in mind, we will remain flat for now.
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--- Written by Ilya Spivak, Currency Strategist for DailyFX.com
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