GBP/USD Testing a Recent Price Bottom

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GBP/USD Testing a Recent Price Bottom

GBP/USD has recently put in a price bottom. Today, during US holiday trading, the market is testing this price bottom. Let’s take a look at the technical developments in the 4H chart.

The 1.5586-1.5735 range (about 150 pips) made in the past 2 weeks is now a price bottom, as GBP/USD broke above 1.5735 this week. Cable is now retreating from 1.5825 and testing this price bottom as support. If price can hold above 1.57 and push above 1.5735, the bullish correction mode remains. A break below 1.57 and a subsequent failure to break above 1.5735 would be a bearish continuation sign which would put pressure on the 1.5586 low, with risk of falling towards the 1.55 handle.

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Fan Yang has been a professional forex trader and analyst since 2007. He specializes in technical analysis and has a Chartered Market Technician designation since 2011. He was the chief technical strategist at CMSFX He was also the founder and chief currency strategist at FXTimes Over the years, Fan has not only been a trader and analyst but also an educator. As a proponent of both technical and fundamental analysis in trading, Fan advocates simplicity and discipline as key factors in making trading decisions when faced with so many "clues" and "signals". Currently Fan Yang is the chief currency analyst and webinar instructor at forexminute.com.