FX.co ★ GBP/USD intraday technical levels and trading recommendations for October 24, 2014

Overview:

The GBP/USD pair has been moving downwards below the depicted downtrend line since July 15 when extensive bearish impulse was initiated.

Many bearish impulses were previously initiated around 1.7180, 1.6630 and 1.6400 where the downtrend line came to meet the pair then.

The price zone of 1.6060 - 1.6090 constituted a transient daily support that paused the bearish movement for a few days since September 9. However, the bears quickly managed to push below reaching down to 1.5890 (depicted on the chart).

A recent bearish impulse took place after retracement towards the price zone of 1.6200.

Price level of 1.5890 provided evident bullish recovery. A bullish engulfing daily candlestick is manifest on the chart.

Recently, the bulls has pushed above the downtrend line. Bullish breakout off the descending-wedge pattern is already manifest on the chart. 

Bullish fixation above 1.6060 is needed to enhance the bullish scenario.This will probably liberate a strong bullish swing towards 1.6250 initially ( significant bottom established in February 2014 ).

Trading recommendations:

Initial bullish fixation above 1.6090 ( the broken trend line ) indicates a valid BUY entry towards 1.6250 and 1.6310. Stop Loss should be located below 1.6015. 

Stepping above 1.6180 ( the recent top ) probably confirm a longer term bullish correction towards 1.6380-1.6400 where 38.2% Fibonacci level is located.