British Pound Leaning toward the Downside

After an early attempt to breakout to theupside, the GBP USD ran into sellers who quickly pushed this pair to thebearside of a pair of Gann angles. Fundamentally, traders are concerned the newausterity measures will slow down the recovery.

After an early attempt to breakout to theupside, the GBP USD ran into sellers who quickly pushed this pair to thebearside of a pair of Gann angles. Fundamentally, traders are concerned the newausterity measures will slow down the recovery.

At the mid-session the British Pound istrading on the bear side of an uptrending Gann angle at 1.5569 and on the bearside of a downtrending Gann angle at 1.5557. This price cluster was piercedearly in the session, but the move did not attract any follow-through buying.

Although the Gann angles are indicatingdeveloping weakness, it looks as if an acceleration to the downside is likelyto start following a close under a minor .618 level at 1.5457. Once this areais penetrated, the charts indicate the market can go into a free fall becausethe next major downside level is 1.5113.