GBP/USD dropped today after the failure to stay above a very important dynamic resistance. It remains to see what will really happen in the upcoming days because right now we need a confirmation that the rate will resume the upside movement or if the rate will start an important downside movement.
Right now you should stay away and wait for a fresh trading signal because we don’t have a great trading opportunity now. Personally, I really hope that we’ll have a great trading opportunity soon, so you should keep an eye on this pair.
It is very important to see what will really happen on the USDX because maybe the rate it will try once again to reach at least the inside sliding line (SL) of the major descending pitchfork. You can see that the rate it has found a very strong resistance at the upside 50% Fibonacci line of the ascending pitchfork and now could approach and retest the inside sliding line (sl). It could still increase as long as it stays above the inside sliding line (sl) and above the median line (ml).
I want to remind you that only a valid breakout above the SL, above the 50% line and above the upper median line (UML) will really confirm a further increase and the USD dominance. A valid breakdown below the median line (ml) will signal a potential drop.
Price it is almost to reach and retest the 50% Fibonacci retracement after the failure to stay above the upside 50% Fibonacci line. Personally, I believe that only a valid breakout above the upper median line (uml) of the minor descending pitchfork and only it will stay above the 50% line it will confirm a further increase.
I’ve told you in the previous weeks that this could be only temporary rebound and the rate will fail to stay above the lower median line (LML) of the major descending pitchfork.