I've been long on GBPUSD from 1.60 levels and a bit biased that GBPUSD could be bullish.
Reasons:
1. Bullish divergence: RSI makes a higher low as price makes a lower low. Price managed to break above 1.60717 and could retest this level again.
2. Inverted H&S: Key price level to break is 1.61823
3. New rising trend line is holding with two contacts made already. Confluence with 1.60717 retest
4. Longer term, the lows made at 1.5882 falls within previous support regions.
5. Not shown on chart, a negative divergence emerged after prices topped. The lows at 1.5882 incidentally stalled near the start of this divergence.
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What am I looking for?
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A retest of 1.60717 and it should hold for a small rally to/or a break of the neckline at 1.61823, validating the IHS which gives an upside target to 1.64826.
Invalidation: A break below 1.60717 would also mean a break of the rising trend line. However, a retracement to the TL break near 1.60717 could be seen where i'll exit longs.
****Monthly Charts (see comments)****
Reasons:
1. Bullish divergence: RSI makes a higher low as price makes a lower low. Price managed to break above 1.60717 and could retest this level again.
2. Inverted H&S: Key price level to break is 1.61823
3. New rising trend line is holding with two contacts made already. Confluence with 1.60717 retest
4. Longer term, the lows made at 1.5882 falls within previous support regions.
5. Not shown on chart, a negative divergence emerged after prices topped. The lows at 1.5882 incidentally stalled near the start of this divergence.
---------------------------------
What am I looking for?
---------------------------------
A retest of 1.60717 and it should hold for a small rally to/or a break of the neckline at 1.61823, validating the IHS which gives an upside target to 1.64826.
Invalidation: A break below 1.60717 would also mean a break of the rising trend line. However, a retracement to the TL break near 1.60717 could be seen where i'll exit longs.
****Monthly Charts (see comments)****
