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Talking Points:
- GBP/USD Technical Strategy: Flat
- Support: 1.5574, 1.5486, 1.5387
- Resistance: 1.5700, 1.5788, 1.5929
The British Pound tested above familiar range top resistance against the US Dollar but failed to secure a breakout yet again. Near-term support is at 1.5574, the 23.6% Fibonacci expansion, with a break below that on a daily closing basis exposing 1.5486 (trend line, 38.2% level). Alternatively, a push above the 1.5675-1.5700 area (July 15 high, 61.8% Fib retracement) opens the door for a challenge of the 76.4% threshold at 1.5788.
Risk/reward considerations argue against entering long with prices in close proximity to resistance. On the other hand, the absence of a defined bearish reversal signal suggests taking up the short side is premature. We will remain flat for now, waiting for an actionable opportunity to present itself.
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--- Written by Ilya Spivak, Currency Strategist for DailyFX.com
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