GBP/USD – 1.2820

Most recent candlesticks pattern   : N/A

Trend                                 : Near term up

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Tenkan-Sen level                 : 1.2840

Kijun-Sen level                    : 1.2879

Ichimoku cloud top              : 1.2980

Ichimoku cloud bottom        : 1.2974

Original strategy :

Sell at 1.2910, Target: 1.2810, Stop: 1.2945

Position : –

Target :  –

Stop : –

New strategy  :

Sell at 1.2910, Target: 1.2810, Stop: 1.2945

Position : –

Target :  –

Stop : –

Sterling ran into heavy selling pressure at 1.3015 yesterday and has dropped sharply, price just broke below 1.2866 support earlier today, suggesting top has indeed been formed at 1.3048 earlier and downside bias is seen for this the erratic decline from there to extend weakness to 1.2780-85 (50% Fibonacci retracement of 1.2515-1.3048), however, near term oversold condition should prevent sharp fall below previous support at 1.2757 today, bring rebound later.

In view of this, would not chase this fall here and would be prudent to sell cable on recovery as previous support at 1.2926 should turn into resistance and cap upside. Above this level would defer and suggest an intra-day low is formed instead, bring a stronger rebound to 1.2950 but upside should be limited to 1.2990-00.

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