GBPUSD is in downtrend but is oversold

Russell Shor, CFTe, MFTA FXCM

GBPUSD’s EMAs are in a bearish formation. The green 5-day EMA is below the orange 13-day EMA, and the orange 13-day EMA is below the black 34-day EMA. This is typical of a mark-down phase in the cycle. However, we do note that the RSI(9) is at 15.33 and is considered oversold (blue rectangle). Therefore, the risk:reward setup is not as beneficial as one would like if a short position was to be considered. It is possible that we may see a halt or a pullback as the oscillator normalises.

Author

Russell Shor, CFTe, MFTA

FXCM

Russell Shor (MSTA, CFTe, MFTA) has an Honours Degree in Economics from the University of South Africa and holds the coveted Certified Financial Technician and Master of Financial Technical Analysis qualifications from the Interna

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