Last Friday on NFP day the pound bounced off of the down trend line well seen on the daily chart. However I think the pair has reached temporal bottom and we should see some up moves in the following weeks. Below you can find the technical reasons for my bullish opinion.
Technical Overview:
W1: Over 20 candles ride on the Bollinger Bands, inverted hammer + equal tails pattern
H4: Break of channel and important resistance
Entry:
H4: We can expect the pair to create a small rally or a flat move and pattern (wedge, flag) before pushing down one more time. We are looking for hidden bullish divergence to complete not lower than the up trend line. Remember that 1.5060 support zone along with the up trend line must hold. Breaking it down would mean invalidation for this setup.
Target 1: 1.5280
Target 2: 1.5350
Target 3: 1.5550
Stop Loss: below 1.5060 and the up trend line
Video Explanation:
