GBP/USD Technical Analysis | GBP/USD Trading: 2015-04-07 | IFCM UK
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GBP/USD Technical Analysis - GBP/USD Trading: 2015-04-07

Triangle breakout

Let’s consider the GBP/USD currency pair on the H4 chart. The price left the triangle area in the green zone direction, breaking the upper limit of the chart pattern. At the same time there was a bullish reversal of Donchian Channel and ParabolicSAR. Now we can observe a local retracement, which formed a bearish candlestick pattern called “absorption”: the price broke the H4 trend line. However, there is no sufficient reason to consider this signal reliable. RSI-Bars oscillator indicated a false breakout and got back inside the uptrend channel. It means that the retracement is about to be finished if unexpected fundamental data is not released.

GBP/USD

Buy position can be opened above the fractal resistance at 1.49875, which is confirmed by the upper Donchian Channel boundary. But conservative traders are recommended to wait for the corresponding resistance breakout at 69% on the oscillator chart. Thus, all the analytical tools will indicate the confirmation signal. Stop loss is to be placed below the support level at 1.48043. This level is strong because it is located inside the triangle, so the price is unlikely to return into this area. This mark is also confirmed by ParabolicSAR historical values and the lower Donchian Channel boundary. After pending order placing, Stop loss is to be moved every four hours following Parabolic signals. Thus, we are changing the probable profit/loss ratio to the breakeven point.

PositionBuy
Buy stopabove 1.49875
Stop lossbelow 1.48043

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This overview has an informative and tutorial character and is published for free. All the data, included in the overview, are received from public sources, recognized as more or less reliable. Moreover, there is no guarantee that the indicated information is full and precise. Overviews are not updated. The whole information in each overview, including opinion, indicators, charts and anything else, is provided only for familiarization purposes and is not financial advice or а recommendation. The whole text and its any part, as well as the charts cannot be considered as an offer to make a deal with any asset. IFC Markets and its employees under any circumstances are not liable for any action taken by someone else during or after reading the overview.

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