Today on GBPUSD – Daily and H4 charts support Short trades.

On the Daily chart above, yesterday, with the support of higher time frame charts, we concluded our bias was bearish, but that we would like to see price to, not only close below the most recent Daily swing low @ 1.5808 (which we’ve highlighted using the lower blue broken line) by the end of yesterday, but also below the lower edge of the downward or bearish channel. As at the end of yesterday, though price closed @ 1.5798 – slightly below the 1.5808 level, it was unable to close, clearly, below the downward or bearish channel. However, current price action is strengthening our bearish bias: price recently breached yesterday’s low @ 1.5727 (not highlighted to avoid cluttered chart). This single price action, with the support of previous price actions, is quite good enough for us to seek Short trade setups on the Hourly charts – supported by the H4 charts.

On the H4 chart above, price has broken the most recent swing low @ 1.5727 (which we’ve highlighted using the blue broken line) downward. That automatically sustains our bias in favor of a downward price move. Please NOTE that 1.5727 – the most recent swing low level – also happens to be yesterday’s low, which we discussed on the Daily chart.
The white horizontal line @ 1.5882 highlights the most recent swing high, and as long as price stays below it – in the absence of any new and lower swing high – our bearish or downward bias remains intact.

However, we still need our Hourly charts – using Fibonacci retracement levels and important resistance levels – to seek promising areas to take our Short positions. Price pattern on the Hourly must also be forming lower highs and lower lows. Please note that our aim is to sell a rally in today’s down-trend.

Also, PATIENCE is the key here: we need to patiently wait for the Hourly retracement. It might happen, and it might not.