On my previous analysis of
GBP/USD currency pair, i gave a strong bearish signal on the GBPUSD corrency. One that will move for 500 to a thousand pips before reversing, but since then, the bulls
are not giving up the fight and they are pushing the price up where they met a stiff resistance from the beers. Looking at the GBPUSD currency pair chart, one won't help to ask what will be the next direction of the currency. Lets analyse GBPUSD monthly currency chart to see what it's saying.
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| GBP/USD currency live currency chart |
In my analysis of the chart above, you will see that candle stick B is testing the highest price the bulls have been able to reach since 1st April, 2011 which is 1.67448 as shown as C on the monthly chart above. The monthly candle stick is not saying much, before we can make anything out of it, that monthly candle stick B will have to close below 1.67448 price level and if it closes above 1.67448 price level, it means the bulls want to test another very strong resistance level, which is 1.70416 price (the highest price the bulls have reached since August 1st 2009).
The monthly candle stick is not going to give a clear signal until it closes, so lets do the analysis of the weekly candle chart to see if it show us the next turn of the market because according to the monthly chart, the market could move either up or down.
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| GBP/USD Weekly Currency Chart |
On the weekly chart analysis, it has given us a very clear picture of the next turn the market will make. On the weekly chart above, you will see that the bears tested the 1.67620 price level (shown as candle stick C on the chart) but ended up closing below that level which is a very big sign that the bearish trend reversal i predicted on my first
analysis of this currency pair holds sway. The second indicator of a reversal is candlestick C retesting the broken trend line 1.
So how do we take up positions based on this analysis? lets look at the daily candle stick for the answer.
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| GBP/USD daily Currency Chart |
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| GBP/USD daily Currency Chart |
On the chart above, you will see the last two candle stick bouncing off the trend line and major weekly resistance level which is at 1.67448 and 1.67620 price levels. You can go short after candle stick B has formed or if you are a conservative trader, you can wait until trendline 2 is broken.
View the first
GBP/USD technical analysis
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