Trade Idea: GBP/USD — Sell at 1.5800

GBP/USD - 1.5632

Most recent candlesticks pattern : N/A
Trend : Down

Tenkan-Sen level : 1.5637
Kijun-Sen level : 1.5803
Ichimoku cloud top : 1.6074
Ichimoku cloud bottom : 1.5989

Original strategy :

Sell at 1.5700, Target: 1.5500, Stop: 1.5765

New strategy :

Sell at 1.5800, Target: 1.5600, Stop: 1.5865

Although the British pound fell marginally to 1.5535 (Friday’s low was 1.5559) earlier today in Asia, lack of follow through selling and the recovery from there suggest consolidation would take place and retracement to 1.5700 is likely, however, renewed selling should emerge around the Kijun-Sen (now at 1.5803) and bring another decline later. Break of said support would extend one more fall to 1.5500, however, oversold condition should prevent sharp fall below 1.5450 and reckon 1.5412 (100% projection of 1.6879 to 1.5832 measuring from 1.6459) would hold from here and bring a much-needed rebound later.

In view of the above analysis, we prefer to look to sell cable on subsequent recovery. Only a firm breach above resistance at 1.5850 (previous support turned resistance) would suggest a temporary low is in place.

Based on ActionForex.com Technical Outlook