USD Weakness Continues with Massive Nose Dive

Dear traders, the GBP/USD is breaking above the resistance trend lines (dotted red) with fierce momentum. The US Dollar is losing its ground due to fears over its economy with the coronavirus spreading.

4 hour chart

The GBP/USD momentum is very strong. This makes it likely a wave 3 (blue). The bullish impulse will probably continue to at least 1.3250-75 before any significant pullback will take place. Ultimately the bullish bounce took place the 50% Fibonacci support of wave B vs A at 1.2735.

1 hour chart

The GBP/USD is showing an aggressive wave 3 (green) and a shallow wave 4 (green) pullback. The bounce at the 23.6% Fibonacci indicates that the bulls are fully in control. A bullish 5 wave pattern is expected to take price up to 1.35 with a pullback at 1.3250-1.33.

Good trading,

Chris Svorcik

The analysis has been done with the help of SWAT method (simple wave analysis and trading)

For more daily technical and wave analysis and updates, sign-up up to our newsletter