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Talking Points:
- GBP/USD Technical Strategy: Flat
- Support: 1.5452, 1.5337, 1.5189
- Resistance: 1.5551, 1.5631, 1.5814
The British Pound turned lower against the US Dollar as expected after putting in a Bearish Engulfing candlestick pattern. Near-term rising trend line support is at 1.5452, with a break below that on a daily closing basis exposing the 38.2% Fibonacci retracement at 1.5337. Alternatively, a turn back above the 1.5519-51 (23.6% level, February 26 high) opens the door for a challenge of the 14.6% Fib at 1.5631.
Risk/reward considerations argue against entering short with prices in close proximity to support. On the other hand, the absence of a defined bullish reversal signal suggests taking up the long side is premature. We will remain flat for now, waiting for an actionable opportunity to present itself.
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Daily Chart - Created Using FXCM Marketscope
--- Written by Ilya Spivak, Currency Strategist for DailyFX.com
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