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- GBPUSD: Cable Forms a Big Rising Wedge Pattern
GBPUSD: Cable Forms a Big Rising Wedge Pattern
The Pound notably strengthened on Monday and pushed above the 1.31 level, where it hit a wall of selling offers around 1.3150 as previous highs are located there and this level is therefore an important resistance.
The four-hour candle looks like a bearish engulfing bar, implying a possible bearish reversal. The first line of support is at 1.3130, where the steep bullish trend line of the rising wedge pattern is located. Should cable drop below, bulls will be defending the 1.31 zone. If this support cracks, there will be a bigger space for correction, possibly below the psychological zone of 1.30.
However, if the situation improves, bulls could re-attack the current swing highs at 1.3170 and then highs from the end of July around 1.3215 could be in play. Overall, the outlook for today's trading will depend on whether the price stays in the rising wedge pattern and drops below the upper trend line.
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