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Talking Points:
- GBP/USD Technical Strategy: Flat
- Support: 1.6533, 1.6470, 1.6407
- Resistance:1.6599, 1.6661, 1.6762
The British Pound may be preparing to launch an upswing against the US Dollar following the formation of a bullish Piercing Line candlestick pattern. A daily close above the intersection of the 14.6% Fibonacci retracement and a falling trend line set from mid-July at 1.6599 exposes the 23.6% level at 1.6661. Alternatively, a turn below the 38.2% Fib expansion at 1.6533 clears opens the door for a test of the 50% threshold at 1.6470.
Prices are too close to resistance to justify entering long from a risk/reward perspective. On the other hand, the absence of a defined bearish reversal signal suggests taking up the short side is premature. With that in mind we will remain flat for now.
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Daily Chart - Created Using FXCM Marketscope 2.0
--- Written by Ilya Spivak, Currency Strategist for DailyFX.com
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