The GBP/USD pair fell during the session on Thursday, and if you have been reading my articles you know that I have been very interested in this general vicinity. What I find interesting now is the fact that even though we have formed two hammers, the sellers continue to press this pair lower. In reaction though, the support level has acted quite strong, as the candle for the Thursday session simply confirms the validity and importance of the support area.
That being said, I still am very interested in buying this pair on a break above the Wednesday highs, which is essentially the same thing as saying above the Thursday highs. If we get that going on, this market will more than likely make a move towards the 1.5750 handle, and as a result could set up a nice short-term buying opportunity.
There's also a potential selling opportunity.
If we break the bottom of the Wednesday hammer, and close below the 1.54 level, I believe that's a nice short-term selling opportunity as the market will more than likely aim towards the 1.5250 level. If that's the case, I would be a seller, but I would not expect to see a big move lower.
Ultimately, I still believe that the uptrend is going to be a lot easier and as a result I am much more comfortable buying at this point. Because of this, I am definitely willing to put a much larger position on if we go higher, but still will be quick to take my profits as liquidity certainly is not in the marketplace at the moment. However, once we get into the middle of September, all of the big players will be back and we could start to see significant and more trustworthy moves and not only this market, but all of them out there. Because of this, I will not put on full position sizes until somewhere around September 15, or whenever the markets decide to make their intentions known. At this moment in time, it is just simply too much of a guesswork type of situation to put any real money into this market.
