CLASSIC Fibonacci retracement occurring in GBP/USD here on the daily chart after last week’s MAJOR move that saw cable drop 700 pips. The pair is even defying fundamentals such as a dovish BoE v. a more hawkish Fed, in this hike right back to 1.6000 where price is edging even higher towards the 38.2% Fibo level.
So will the trend continue down after this bounce or a reversal in the making? IF 50% Fibo is achieved, and that’s a big IF, any breach may be first clue that the trend is reversing to the upside. However, looking at fundamentals, I am very bearish GBP and see the GBP/USD continuing to the downside.
