GBPUSD: Sellers Carve Out Bearish Engulfing Day Ahead of NFP

Written by Justin Bennett

|   Last Updated February 2, 2017

·      February 2, 2017

Written by Justin Bennett 

|   Last Updated February 2, 2017


Over the weekend I commented on a 260 pip range that would likely restrain the GBPUSD this week. Key support came in at 1.2415 while resistance was last Thursday’s high at 1.2673.

I wasn’t too far off the mark as this week’s low so far is 1.2411, and yesterday’s high was 1.2705.

But more important is the way yesterday’s session shaped up. After rallying 30 pips above the 1.2673 level on an intraday basis, the pound gave back 180 pips against the USD, forming a bearish engulfing day in the process.

However, current prices are too close to key support at 1.2415 to secure a favorable risk to reward ratio. As such, I’ll be on the lookout for a retrace – perhaps into the 1.2600 area – before considering an entry.

Otherwise, we’ll need to wait for a close below 1.2415, which would expose the next level of support at 1.2200. Only a daily close above the 1.2670 area would negate the bearish bias.

The upcoming non-farm payroll report at 8:30 am EST could create an opportunity here, but I won’t be doing anything until the dust settles.

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GBPUSD bearish engulfing candle


Justin Bennett - founder of Daily Price Action

About the author

Justin Bennett started trading in 2002, and let's just say it was a bumpy ride. But in 2010, he had his "aha" moment once he ditched the indicators and focused 100% on price action. Justin has built a following of 100,000+ monthly readers and taught thousands of traders using his simple, no-nonsense approach. He's been highlighted as a top trader by Stocks and Commodities Magazine and regularly featured by Forex Factory next to publications from Bloomberg and CNBC. ...Read More


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  1. Justin, you have been saying that the EURUSD rally is short time anomaly, and the general trend is downwards. But looks like it is for real, has been going UP for abt 30 weeks.. Are you sure you were not, by any chance, mistaken?

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