GBP/USD Sets Up for A Bearish Reversal, After Failing at the 100 SMA
Last week, we decided to go short on GBP/USD , opening a long term sell forex signal at 1.2250s, as this pair was finding resistance at the 100 simple MA (green) on the H4 chart. The trend in this pair has been bearish for quite some time, but in the first few weeks of March GBP/USD crashed around 18 cents lower, as coronavirus spread in Europe.
So, the main trend is still bearish for this pair, that’s why we decided to go short on the pullback. But, buyers decided to push higher and they sent the price close to 1.25, which is another big round level. But, the 100 smooth MA (red) stopped the climb below 1.25.
This moving average has been providing resistance since then and today buyers tried to push above it, as it slips lower. But they couldn’t hold above it and the price reversed at the resistance at 1.2480. it slipped below the 100 SMA again, forming an upside-down pin candlestick which is a reversing signal. The current signal looks bearish, but the 20 SMA (grey) is providing support now, so that moving average has to go is sellers want to get the situation in their hands, which we hope they do.
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