GBP/USD Price Analysis: Testing strong resistance area, bears waiting to fade


  • GBP/USD has reached a key level of resistance structure.
  • The distribution perceived as the next thing to come from GBP could lead to a 4HR swing trading opportunity. 

GBP/USD is testing a strong resistance area which gives rise to a potential high probability shorting opportunity as follows:

Live D1 chart

The price action has been monitored since the following article was published:

as expected, as evidently illustrated below in the previous charts, cable was expected to climb to test the resistance:

Prior D1 chart

Prior 4HR setup charts

 

As can be observed, all is going to plan and we now need to see bearish conditions as the price is rejected at the current resistance area:

The market still has some leg work to do, but this a pair that can go on the watchlist and the downside fits the bearish Brexit narrative well.

Similarly, stubbornly long CFTC positioning highlights downside risks and the recent rise of no-deal Brexit probability bodes ill for the rather complacent sterling. 

Compared to previous risks of a hard Brexit, GBP positing in at surprisingly high levels. 

Then, when looking to the DXY for further confirmation, there is a bullish technical picture there as well:

Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.

Feed news

Latest Forex News


Latest Forex News

Editors’ Picks

EUR/USD trades at fresh September lows

Risk-aversion is the main theme this Monday, amid resurgent coronavirus cases in the Old Continent and the announcement of  new lockdowns. ECB’s Lagarde said the economic recovery in the EU is “very uncertain, uneven and incomplete.”

EUR/USD News

GBP/USD extends slump sub-1.2800

The Pound plunged on a dismal market mood, as PM Johnson acknowledged the kingdom is undergoing a second coronavirus wave. GBP/USD trades at one-week lows around 1.2800.

GBP/USD News

XAU/USD bullish bias starting to fade

Gold prices are testing the bull's commitments at the support structure around $1,906 in what could be a final test before the next leg higher of the bullish trend.

Gold News

Bitcoin needs to defend critical support level at $10,600

Bitcoin was trading inside an ascending triangle pattern between September 3 and September 15, which is created when the price establishes higher lows and a horizontal trendline around the swing highs. 

Read more

WTI plummets to $39, down more than 4%

Crude oil prices closed the previous week sharply higher but erased a large portion of those gains on Monday. As of writing, the barrel of West Texas Intermediate was down 4.2%, the biggest daily percentage decline in nearly two weeks, at $39.15.

Oil News

Forex MAJORS

Cryptocurrencies

Signatures