The Pound Trying to Recover 26/1/2022

The British pound yesterday touched the first official target of the bearish technical formation shown in the previous analysis at 1.3440, recording the lowest level at 1.3436, to return to the bullish rebound to retest the resistance level of the psychological barrier 1.3500.

Technically, by looking at the 4-hour chart, we notice that the pair has built on the mentioned support level of 1.3400. Still, the negativity features dominate the stochastic indicator accompanied by the negative pressure coming from the moving average.

Therefore, the bearish scenario is still the most preferred today as long as trading is stable below 1.3530, knowing that the decline below 1.3460 extends losses towards the second official target of 1.3400.

Trading stability above 1.3530 could negate the downside, and we may witness an upward bias with an initial target of 1.3600.

Note: Fed statement is due today and may cause high volatility.

Note: CFD trading involves risks; all scenarios may occur.

S1: 1.3440	R1: 1.3530
S2: 1.3400	R2: 1.3585
S3: 1.3365	R3: 1.3610