GBPUSD has been bearish since Feb and is currently nearing support. The overall picture on the daily chart looks quite bearish:
1. Price under Kumo
2. Kumo thick
3. Tenkan-Sen below Kijun-Sen
4. Chikou Span has been below price. Is currently inside price but near a bearish break.
All that is needed for the bearish trend to resume is for the price to close below the swing low. I have used the 4H chart to mark a significant level at 1.29925. I will be looking for a short trade if we break below here on the 4H chart.
I won't short just yet. While the 1D chart is definitely more bearish, the 4H chart is choppy. The flat Ichimoku Han-ne lines tell us that price could retrace, so we need to wait for confirmation first.
It's also worth noting that IG Client Sentiment has retail traders net long 77%. Retail traders are typically losing traders, so if retail is loading up long, it increases my conviction to go short.
My plan is simple:
1. If price breaks lower, I look to short.
2. If price retraces upwards, I stay away.
2. Kumo thick
3. Tenkan-Sen below Kijun-Sen
4. Chikou Span has been below price. Is currently inside price but near a bearish break.
All that is needed for the bearish trend to resume is for the price to close below the swing low. I have used the 4H chart to mark a significant level at 1.29925. I will be looking for a short trade if we break below here on the 4H chart.
I won't short just yet. While the 1D chart is definitely more bearish, the 4H chart is choppy. The flat Ichimoku Han-ne lines tell us that price could retrace, so we need to wait for confirmation first.
It's also worth noting that IG Client Sentiment has retail traders net long 77%. Retail traders are typically losing traders, so if retail is loading up long, it increases my conviction to go short.
My plan is simple:
1. If price breaks lower, I look to short.
2. If price retraces upwards, I stay away.
Trade active:
I am very happy that I was patient with this. IG Client Sentiment has remained very bullish, giving me confidence that it is actually going to be bearish. We have had a big break below support this morning in early trading. I got in at the support break and am currently riding the trend.