GBPUSD Analysis – Now waiting for a H&S pattern

We will continue the story of the Dollar but in this piece we will combine it with the GBP, so our hero in this piece is Cable, which was previously mentioned here on the 21st of December. Back in that day, our view was rather bearish and we were waiting for a bigger drop:

“Additional bearish help comes here from the black mid-term down trendline. As long as we stay below those, the negative sentiments seems untouchable. My view on Cable is bearish. „

The end of the story is that for the past few days, we did not get any results here. The price went lower, then higher and lower again. No major breakout. The thing is that even if it did not bring any solution, it helped to create additional technical factors on the chart. The latest one is the Head and Shoulders pattern (yellow). Pattern bounced from the mid-term down trendline (black) and the resistance mentioned in our previous piece (purple). H&S formation has also a red neckline. The way to approach this situation is to sell the breakout of the neckline or buy the breakout of the black line. Either way really, remember that you are traders and you can earn money both ways, so use it sometimes.