By: John Ursus
Timeframe: W1
Recommendation: Long Position
Entry Zone: 1.4900 – 1.5000
Take Profit Zone: 1.6000 – 1.6200
Stop Loss Zone: 1.4500 – 1.4700
The GBPUSD has accelerated its sell-off after breaking down below its 61.8 Fibonacci Retracement Fan support level. The GBPUSD is now approaching a multi-year low from where a triple bottom could form. The correction took this currency pair from an intra-day high of 1.7191 to an intra-day low of 1.4951. The GBPUSD is trading in extreme oversold conditions from where this currency pair could face a short-covering rally.
The sell-off took the GBPUSD well below its 61.8 Fibonacci Retracement Fan and has not allowed for the establishment of meaningful resistance level from its current multi-year low until it reaches its 61.8 Fibonacci Retracement Fan. Forex traders are advised to spread their entries over a 100 pips range between 1.4900 and 1.5000. The downward potential appears to be rather limited while the upside potential remains very attractive.
