After Failed Bearish Breakout, GBP/USD Has 1.6415 in Sight |
Prev: GBP/USD in a Pullback after Bearish Breakout (7/18)
GBP/USD
Failed Bearish Breakout
- The bearish breakout yesterday was followed by a pullback towards 1.6075. We reached across to find resistance at 1.6080, but the market stayed above the recent local pivot near 1.6058, and built strength instead.
Bullish Breakout…more clues needed
- Now there is an upside break. Note the RSI kissing 70 after just kissing 30, reflecting a ranging mode. The break to the upside is like the break to the downside so far - no confirmation yet.
- A throwback can help to confirm the bullish intent if it fails to break below 1.6080. That will confirm weak bears. To confirm strong bulls, we want to see the RSI break above 70 convincingly.
- The RSI in the 4H chart should at least break back above 60 to start signaling the bullish attempt. We can also see that the recent high near 1.62 is indeed a cluster of resistance (up to 1.6215 area).
- A break above 1.6215 reach towards 1.6285-1.63. If we find resistance here, but the market remains above 1.62 in a throwback, we should continue to see bullish intent towards a swing projection target to 1.6415.
Fundamental Pivot:
- Bank of England Meeting Minutes come out over the European session at 4:30AM EDT (8:30AM GMT, 9:30AM BST). The reaction can either accelerate the bullish trend, or pause it. If it pauses it, look at the resistance it gives as an important pivot to break before re-opening the 1.6415.
- A break below 1.6080 ahead or after the release can be a bearish signal. If the market is bearish ahead of the release, and the release pauses it, the support created by the reaction will need to be broken before considering a return towards the 1.58 low.
Information and opinions contained in this report are for educational purposes only and do not constitute an investment advice. While the information contained herein was obtained from sources believed to be reliable, author does not guarantee its accuracy or completeness. FXTimes will not accept liability for any loss of profit or damage which may arise directly, indirectly or consequently from use of or reliance on the trading set-ups or any accompanying chart analysis.
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