GBPUSD Setup For Bearish Correction

3 gen 2022

GBPUSD has just reached the upper boundary of the downward channel it's been trading within for the past 6 months.

As price entered this upper boundary area the RSI briefly reached >70 on the 6H before being rejected.

Meanwhile on the 2H chart price has been showing textbook bearish divergence - 3 significant, consecutive lower highs on the RSI while price continues to climb, showing that the strength of the uptrend is dying out as the price reaches the upper channel boundary.

Expect a bearish move for a continuation of the channel. Short positions may find a good stop loss option directly above the upper channel boundary.

Always ensure your stop and target offer you a positive Risk/Reward ratio. I personally target 2 R trades that ensure I only need 33.3% win rate to break even, and a 50-60% win rate is highly profitable.