GBP/USD Daily Descending Trend line
Hi Traders,
Have a look at GBP/USD on the 4-hour and daily chart today.
Having a look at the Daily time frame, we can see that price has been respecting this bearish trend line since the 20th of February 2022. We've had 5 taps so far on this giant daily trend line. Currently, it looks like the price is pushing to print its 6th tap.
Now, we don’t know whether or not this next tap will be the one to finally break us out of this bearish pressure that we have been in for the greater part of 2022.
However, if we were analyzing a trend, we can see that this trend is not bullish. Our bias must remain bearish until proven otherwise. Now, I am no fortune teller and I am not one of those traders that say that they can pick out where the exact bottom is. I only trade setups that make sense to me. So having said that, let's go deeper into the 4-hour time frame.
This chart shows that price has been pushing upwards, bouncing inside this ascending channel.
What do we look for on ascending channels? Usually, we look for a break and retest of the channel bottom. This means we are waiting for a possible bearish break of this channel with a retest of the bottom of the channel. If we see that, we can open up a short position with our targets being previous support around the 1.176 price level.
What's interesting to look for is that if this channel breaks to the downside and retests just as the price is touching or tapping the daily descending trend line, well then that gives us huge confluence to go short.
To add to that confluence, we have divergence on the MACD Histogram. As price makes higher highs within the ascending channel, we can see the histogram make lower lows showing that the bulls that are there right now might start to run out of steam and the giant daily bears might be biding their time, waiting for that perfect moment to push price back down.
To sum up my current thoughts .. Do nothing until shown a reason to jump in. I cannot force these charts and bend them to my will. Therefore, we wait until these patterns present themselves to us on a silver platter. Then, we jump in and take full advantage of the offering.
Hope you all have a fantastic Tuesday.
See you all on the next one.
The Vortex Trader.
Have a look at GBP/USD on the 4-hour and daily chart today.
Having a look at the Daily time frame, we can see that price has been respecting this bearish trend line since the 20th of February 2022. We've had 5 taps so far on this giant daily trend line. Currently, it looks like the price is pushing to print its 6th tap.
Now, we don’t know whether or not this next tap will be the one to finally break us out of this bearish pressure that we have been in for the greater part of 2022.
However, if we were analyzing a trend, we can see that this trend is not bullish. Our bias must remain bearish until proven otherwise. Now, I am no fortune teller and I am not one of those traders that say that they can pick out where the exact bottom is. I only trade setups that make sense to me. So having said that, let's go deeper into the 4-hour time frame.
This chart shows that price has been pushing upwards, bouncing inside this ascending channel.
What do we look for on ascending channels? Usually, we look for a break and retest of the channel bottom. This means we are waiting for a possible bearish break of this channel with a retest of the bottom of the channel. If we see that, we can open up a short position with our targets being previous support around the 1.176 price level.
What's interesting to look for is that if this channel breaks to the downside and retests just as the price is touching or tapping the daily descending trend line, well then that gives us huge confluence to go short.
To add to that confluence, we have divergence on the MACD Histogram. As price makes higher highs within the ascending channel, we can see the histogram make lower lows showing that the bulls that are there right now might start to run out of steam and the giant daily bears might be biding their time, waiting for that perfect moment to push price back down.
To sum up my current thoughts .. Do nothing until shown a reason to jump in. I cannot force these charts and bend them to my will. Therefore, we wait until these patterns present themselves to us on a silver platter. Then, we jump in and take full advantage of the offering.
Hope you all have a fantastic Tuesday.
See you all on the next one.
The Vortex Trader.