Waiting for pullback completion
Today we would like to focus your attention to GBP/USD . The pound slid from the seven-year high against the euro, and is down from the eight-week high against the US dollar. It was caused by the decline in real estate prices in February for the first time in five months. Note that last week the pound soared to the six-year high against the basket of major currencies. Now investors believe that the Bank of England rate hike will occur no earlier than in 2016. Moreover, there is a hypothetical possibility that the UK may exit the European Union if the Conservative Party wins the parliamentary elections scheduled in May. We don’t rule out the possibility that the pound might continue rising after the technical pullback is over.
The GBP/USD currency pair shows a pullback on the H4 chart, but the uptrend price channel is still remained. RSI-Bars oscillator is now in a neutral range: the latest bars are located below 50. It might be a sign that it is too early to buy. We do not rule out the bullish momentum being developed after the fractal high breakout at 1.55515: this level can be used for placing a pending buy order. Stop loss is to be placed at the lower border of DonchianChannel, which can currently act as the support line at 1.5383. After pending order placing, Stop loss is to be moved every four hours near the next fractal low, following Parabolic signals. Thus, we are changing the probable profit/loss ratio to the breakeven point. If the price meets Stop loss level without reaching the order, we recommend cancelling the position: market sustains internal changes which were not considered.
|Buy stop||above 1.55515|
|Stop loss||below 1.5383|
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