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

On the Daily chart above, again in line with our expectation yesterday, price had its bullish retracement, and then subsequently resumed its bearish move toward the lower edge of the “minor” downward or bearish channel. Although, yesterday’s candle closed as a “doji” – signaling the possibility of a deeper bullish retracement – price disregarded the sign and went ahead to break the previous day’s low @ 1.5936 (not highlighted). Now that the coast seems much clearer, the bearish channel’s lower edge – as the next important support level – is back in focus. Another critical support level we should keep in mind is the most recent Daily swing low @ 1.5831 (that we’ve highlighted using the blue broken line), which is currently some pips above the channel’s lower edge. We should consider the area between the 1.5831 level and the channel’s lower edge as a possible bulls’ zone as price moves further downward toward the area.

On the H4 chart above, price has broken the most recent swing low @ 1.5936 (which we’ve highlighted using the upper blue broken line) downward. That automatically sustains our bias in favor of a downward price move. We could observe on the H4 chart the important 1.5831 support level (which we’ve highlighted using the lower blue broken line) that we discussed on the Daily chart. Price is currently about a 100 pips away from the support level; hence, we seem to have enough room to go short on the currency pair based on the Hourly setups.
The white horizontal line @ 1.6057 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.