GBPUSD - 8/28 - Short Term Buy; Long Term Sell
Here's my analysis for GU for this week. Let's take it step by step.
Overall, the long-term bias for price action is bearish. This is supported by the descending triangle pattern that has developed between the monthly trendline and monthly zone. On the weekly timeframe, price has experienced a trendline bounce after completing a 38.2% fib DT. This indicates to me that the current bearish behavior still has quite alot of strength supporting it and will more than likely persist. On the daily, price action is indicating that the pullback has exhausted and we are waiting on a retest of structure to confirm that the pullback is over.
On our current minor structure at point A, price hit TP1 on both the 30m and 4H fibs before reversing. Price broke through the minor structure zone at point B and then retested it, forming a new supply zone.
Price tapped back into that supply zone at point C before selling off and completing the minor structure 50% fib by hitting our TP2.
At this point, point D, bullish divergence formed between price action and the RSI Indicator.
Because we are at the reversal level, I’m expecting price to push back up and retest our minor structure zone before selling off. This will effectively be our confirmation that the pullback is over and the long term downtrend has resumed.
So, as indicated by my bars pattern, the next move is a buy up to the minor structure zone at or near 1.2798 before the sell.
Because I am placing a bigger focus on my discipline as a trader, I have decided that I will not counter-trend trade. I will only enter a position once price corrects to our zone and resumes the downtrend.
Overall, the long-term bias for price action is bearish. This is supported by the descending triangle pattern that has developed between the monthly trendline and monthly zone. On the weekly timeframe, price has experienced a trendline bounce after completing a 38.2% fib DT. This indicates to me that the current bearish behavior still has quite alot of strength supporting it and will more than likely persist. On the daily, price action is indicating that the pullback has exhausted and we are waiting on a retest of structure to confirm that the pullback is over.
On our current minor structure at point A, price hit TP1 on both the 30m and 4H fibs before reversing. Price broke through the minor structure zone at point B and then retested it, forming a new supply zone.
Price tapped back into that supply zone at point C before selling off and completing the minor structure 50% fib by hitting our TP2.
At this point, point D, bullish divergence formed between price action and the RSI Indicator.
Because we are at the reversal level, I’m expecting price to push back up and retest our minor structure zone before selling off. This will effectively be our confirmation that the pullback is over and the long term downtrend has resumed.
So, as indicated by my bars pattern, the next move is a buy up to the minor structure zone at or near 1.2798 before the sell.
Because I am placing a bigger focus on my discipline as a trader, I have decided that I will not counter-trend trade. I will only enter a position once price corrects to our zone and resumes the downtrend.
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