GBPUSD
The USD is on a tear higher today, and the GBPUSD pair reflects it too. The pair formed a triangle as a reversal pattern and has little or no support until the lower edge of the rising channel.
With Brexit out of the way and holidays over, the market’s attention turns to the transfer of power about to take place in the United States. The events from last week when protesters invaded the Capitol left many marks. One of the reactions was the suspension of the Twitter account owned by the President, an act that shows the power that social media has.
For the USD, this week may turn out to be crucial. All investment houses in the world projected a lower USD in 2021, with not even one thinking that the greenback may strengthen. Because of that, any advance in the USD should happen quicker than many expect due to the majority being positioned on the short side.
The technical picture shows the price breaking a triangle as a reversal pattern. Such triangles typically form at the end of complex corrections, suggesting that there is more room to the downside. As such, bears may want to remain short with a stop at the previous highs and targeting the lower edge of the rising channel.
