The GBPUSD has given the first signs of a short term bottom in place holding at the 1.5000 figure with a price action trigger. The long wick at the bottom of the last candle is well over 60% of the entire candle suggesting the pair was well supported into the dip and had strong enough power to recover quite well.

Had this happened in ranging market, it would have less impact but considering the pair has sold off6 of the last 7 weeks with no rejections or down-candles closing this high up into its range, we have to take it seriously as this reaction is a one of a kind. This could mean the bulls have had enough in the short term and it is rare for a pair to suffer so badly this long and consistently without any pushback.

With that being said, short term aggressive plays can be had on dips into the sub 1.5000 region with stops below targeting 1.5245 and possibly the 50% mark into last weeks candle about 1.5375. Caution is advised as the trend is still down and the price action in the medium term is still supportive of this fact but a candle like this would probably be the best time for the bulls to step in following such a strong pushback.

Chris Capre is the current Fund Manager for White Knight Investments. He specializes in using Ichimoku, Pivot Point and Price Action models to trade the markets. He has built and consulted for several institutions in using his Ichimoku Systems and has an Advanced Ichimoku Course for further training. For more information about his services or his company, visit 2ndskiesforex.com.