Trade of the Day: GBP/USD

By: Dima Chernovolov

GBP/USD continues to fall inside the hourly Falling Wedge chart pattern which was identified recently by Autochartist. Autochartist rates the quality of this Falling Wedge at the 4-bar level – which reflects the slow Initial Trend (2 bars), average Uniformity (5 bars) and higher Clarity (6 bars). GBP/USD is expected to fall further inside this Falling Wedge – in line with the earlier downward reversal from the key resistance area shown below.

As can be seen from the daily GBP/USD chart below, the pair earlier reversed down from the resistance area lying between the pivotal resistance level 1.2540 (former support from June), upper daily Bollinger Band and the 38.2% Fibonacci correction of the previous weekly downward impulse from March. The proximity of this resistance area increases the probability GBP/USD will continue to fall inside this chart pattern.