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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