- Daily and 4H: The GBP/USD broke below a short-term rising channel support, which you can see in the 4H chart. A swing projection in the 4H chart matches the 200% expanded swing projection of a larger scale move. Both targeting below 1.45, near 1.44/1.4380.
- The stochastic failed to roll up from the oversold region in the daily, and in the 4H time-frame was very sharp in decline.
- However looking at the 4H time-frame, we see that the market has been quietly breaking below the powerlines. The stochastic however shows strength because the previous rally attempts were weak as well, so relative to the last 25 bars or so, the current decline is more consistent so far. The beginning of the US session however brings a little bit of bullishness, so be cautious and look for failed bullish attempts to confirm the bearish outlook.
- 1H: The 1H chart shows that the swing was indeed LESS choppy than the rally attempts. However, in the near-term the market is oversold, and looks to be rolling up if there is another couple hours of bullish attempts.
- Look to see if there is topping action near 1.5038 or 38.2% retracement area. Such a pullback can help you confirm weak bullish attempt and therefore readiness to return to the established bearish mode.
Fan Yang
Currency Analyst
Commodity Trading Advisor
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