Daily Forex Technicals |
Written by FXTimes |
Mar 06 12 19:04 GMT
GBP/USD Completes a Head and Shoulder Pattern as it Slides Below 1.58
The GBP/USD respected the 1.59 handle in the 3/5 US trading session, and eventually slid to new lows in the subsequent Asian-European session. In the 3/6 US trading session, the pair has completed a head and shoulder seen in teh 4H chart. The neckline was near 1.58, as well as a rising trendline. With these broken, the GBP/USD opens up a short-term outlook toward 1.5650.
The 4H RSI is about to slide below 30, a bearish signal but can also reflect near-term oversold condition. A subsequent pullback that fails to break above 1.5850 should be a good sign that the market respects the topping pattern and confirm the bearish scenario. The RSI should also remain under 60, preferably 50 and push back below 40 to reflect persistent bearish momentum in the short to medium term for a bearish outlook going forward the next or 2 weeks.
Below the 1.56 handle, we also open up 1.5240 near the 2012 low, with a short-term pivot seen before that at 1.5530 (also 61.8% retracement of the 1.5237-1.5995 2012 bull run).
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