Looking To Short GBP/USD

Thoughts on GBP/USD. Currently long from 1.6000 but looking to short.

Not quite as nice as EUR/USD as normal but again with some minor Retail Buying its about time to close longs and look for shorts in this pair and we currently sit in a nice resistance zone.

The Pound has been really strong lately and this could easily continue, if it does we would expect to see Retail Trader continuing to short it, however, given recent strength we are now back at a key resistance point which could offer some short term shorts, that said it is a risky one as it is essentially top picking, so tight stops are required and be comfortable being wrong on this one and jumping back long.
GBP/USD Weekly" title="GBP/USD Weekly" height="767" width="1024">
As the weekly shows we have a nice resistance zone which we could use to play back into the range and at these levels it does offer good risk reward. It is top picking though and less likely to come off and so a safer play could be a short on a break back below the 1.6277 support level.

However essentially shorts around these levels looking for a retracement back into the range would be playing the false break of the key level.

As we can see on the COT Non Commercials have reduced their net long positions and if they switched this week we could easily see this pair push lower. The weekly does however also show the potential for the spike towards 1.66.

If we see a few more Retailers buying into this pair on the recent breaks of resistance think this pair offers a lot of potential to play back into the range, if they start shorting again I would look to reverse shorts and jump long quickly as this pair is trending up nicely.

So high risk short play possible with tight stops like on EUR/USD but these are riskier so be prepared to switch back to longs at a moments notice.
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