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Collins: I'm selling GBP as positive performance ends
After seeing the end to a sequence of three positive daily performances, Alan Collins from 3c Analysis has decided to temporarily sell sterling dollar. He does stress, however, that the underlying trend for the pound remains positive evidenced by a bullish Keltner channel.
The pound pulled back from a two-year high against the dollar after upbeat comments from Bank of England chief Mark Carney and strong house prices.
Alan adds that the lows may not have been held, but Asian selling indicates that the reaction is incomplete. Furthermore, he says the average has held the downside for almost a month and, statistically, it is rare to see much longer without a serious test.
As a result, he is looking for a move to test that point 1.6336 at the very least. More probably towards last week's 1.6294 low during the course of today.
The risk to this trade is that the setback was shallower than expected and that would be signaled above 1.6412.
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01:07 minutes
Tags: 3c analysis, alan collins, america, asian markets, bank of england, boe, boe governor, british gilts, british pound, carney, dollar, economy, eu, financial markets, gbp, governor mark carney, investing, investment, macro, mark carney, pound, profit, profit taking, risk, sell gbpusd, sell sterling, sterling, trade idea, trader, trading, trading risks, uk economy, us dollar index, us economy, usa