The GBP/USD pair fell during the Thursday session yet again, and managed to get below the 1.55 handle. This pair simply seems like he cannot get out of its own way, and this has been especially true since we broke through the bottom of the hammer on Tuesday. I honestly believed that we were heading towards a basing pattern when I saw all this hammer candle, but one the bottom of the gave way to the sellers, I had to admit that this pair still had plenty of sellers out there looking to crush it.
Because of this, I believe that the 1.50 level will be targeted eventually. We are currently in the middle of the ascending triangle from last summer that sent this pair so much higher, so I believe that there is quite a bit of the ways in this general vicinity. This will make the move difficult to stomach for some people, and they may find it's actually an easier pair to sell rallies going forward on the shorter-term charts. In fact, that's probably how approaches chart more than anything else; simply looking at hourly charts and selling rallies that seem to be running into resistance.
Completely broken
The pair seems to be completely broken at this point, and as a result I don't really have a scenario where I start buying quite yet. In fact, I would need to see a move above the 1.59 level to be convinced that the momentum has changed enough to do so. In my earlier days, I would have been trying to play this chart from both sides, but the relentless selling of the British pound tells me to reconsider any of those types of thoughts.
There are concerns that the United Kingdom will enter a so-called "triple dip recession", and if so there will be quite a bit of weakness going forward. With that in mind, I am going to start selling every time we rise for the foreseeable future. If you choose to play to British temperament, it should be noted that stocks are doing quite well in London as the currency gets devalued.