The GBPUSD market recently broke a key level after a large bearish rejection candle formed right on a support line. The rejection candle was covered in more detail in a previous post: GBPUSD bears putting heavy pressure on support
Now the market has broken downwards and produced modest bearish movement off the back of the support breakout event. We’ve started to see the market recover from some of those losses during an on-going countertrend retracement in this week’s trading.
This countertrend movement is to be expected, and in fact, we need these movements occurring to bring price back to its mean value, where we can look for trade opportunities. We’ve got our sights lines up on a bearish ‘hot spot’ where an important key level lines up with the mean value. If a bearish price action signal is printed here on the daily chart, it would offer a nice low risk/high probability trading opportunity. Keep your eyes peeled.