The GBP/USD pair broke through the bottom of the shooting star from the previous day on Thursday. This set up a nice selling opportunity, but unfortunately the market turned back around and formed a hammer which is finding support at the 100 day EMA. With this being said, it looks like confusion still reigns in this pair, and we could possibly be seen a bit of a double bottom at this point in time. Quite frankly, the easiest trade is to take a long position on a break of the highs from the Wednesday shooting star.
We will buy this pair if it breaks above the highs from Wednesday, or sell it if it breaks below the lows from Thursday. In the meantime, unless you are already involved in this pair is probably best to stay out of it.
Written by FX Empire