FX.co ★ GBP/USD Intraday Technical Analysis August 24, 2011

Another daily candlestick is closing within the consolidation range 1.6433-1.6590. However, the long upper tail enhances the bearish side of the market.

Now the pair is trapped between the strong support 1.6450 ( upper limit of the previous broken consolidation range ) & Resistance Area 1.6565 which is manifested in the rejection of the daily candlesticks.

As we saw yesterday after break of the short-term bullish channel, price declined towards support level 1.6470.

The narrow range is obvious here on this timeframe idicating confusion & balance of Bulls & Bears.

We also may have a Head & Shoulders reversal pattern with the neck line at 1.6434.

4H closure below 1.6434 confirms the H&S pattern and gives the short signal with TP 1.6348,1.6385 & 1.6285.

4H closure above 1.6590 opens the way to 1.6660 then 1.6740 ( the strong resistance on the weekly chart ).