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Double Bottom May Put an End to GBP/USD Downtrend

January 29, 2017 (Last updated on February 26, 2017) by Andriy Moraru

The double bottom that is currently forming on the daily GBP/USD chart has a potential for stopping the medium-term bearish trend that persists since the Brexit referendum. The formation is not ideal — it lacks symmetry and has a malformed middle part. Yet it may offer a valid trading signal in case of the upside breakout.

The image below shows the double bottom marked with the yellow lines. The lower one marks the two troughs. The upper one marks the neckline and midpoint. The cyan line will be used as an entry level for a bullish breakout. I will set my take-profit to the green line, located at 100% of the pattern’s height above the upper border. I will ignore the downside breakouts of this double bottom formation. You can click on the image to see a full-size chart:

GBP/USD - Double Bottom Pattern on Daily Chart as of 2017-01-29

I have built this chart using the ChannelPattern script. You can download my MetaTrader 4 chart template for this GBP/USD pattern. You can trade it using my free Chart Pattern Helper EA.

Update 2017-02-18: I have cancelled the pending order as the chart no longer resembles a proper double bottom pattern.

GBP/USD - Symmetrical Triangle Pattern on Daily Chart as of 2017-02-18 - Post-Cancellation Screenshot

If you have any questions or comments regarding this double bottom on GBP/USD chart, please feel free to submit them via the form below.

One Response to “Double Bottom May Put an End to GBP/USD Downtrend”

  1. Ranga

    GBPUSD will be pushing higher. 1.2800 is the minimum upside, but to call it an end to the downtrend is a bit to early. For now its a nice short-medium term buy (which I think is 50% done already).

    Reply

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