GBP/USD Grinds Higher With A Piercing Line Pattern In Its Wake

Talking Points

• 
  GBP/USD Technical Strategy: Sidelines Preferred
  


• 
  Piercing Line Pattern May Find Limited Follow-Though
  


• 
  Climb Over 1.6660 Needed To Suggest A Small Base
  

GBP/USD continues its grind higher after the emergence of a Piercing Line pattern on the daily. Yet the bullish reversal pattern may struggle to yield a sustained recovery against the backdrop of a core downtrend. This leaves selling into rallies preferred at this point. A daily close above 1.6660 would be required to warn of a small base and the potential for an uptrend to arise.

GBP/USD: Piercing Line Pattern May See Limited Follow-Through

Daily Chart – Created Using FXCM Marketscope 2.0, Volume Indicator Available Here

The narrow range evident on the four hour chart appears to have finally broken following the push above the 1.6603 ceiling. This opens the gate to a walk towards the 1.6660 barrier. Based on the backdrop from the daily selling into corrective bounces would be preferred if a bearish reversal pattern emerges.

GBP/USD: Awaiting Bearish Signals Near 1.6660

4 Hour Chart – Created Using FXCM Marketscope 2.0, Volume Indicator Available Here

By David de Ferranti, Currency Analyst, DailyFX

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GBP/USD Grinds Higher With A Piercing Line Pattern In Its Wake