Outlook For The GBP/USD Still Bearish Until 1.48 Level Broken

George Soros has recently announced that he has ceased betting against the pound now that the GBP/USD is around the 1.40 level but I personally feel that the bias is still towards the downside while we are still trading below the 1.48 level.

The reason I say this is because my own trading system places great importance on the Supertrend indicator on the daily chart. I use this indicator to indicate the current trend and then take positions in the same direction on the 4 hour chart.

The point is that the Supertrend is still red (indicating a bearish trend) on the daily chart and has been since October 01 2008. It has attempted to break this level both in December and for two days earlier this month but despite coming very close, it failed to break through this level and turn bullish on either occasion.

At the moment the Supertrend has leveled out and currently stands at 1.4789. So even though we have seen a strong upwards move this week, there is still a long way to go before I personally start taking long positions on the GBP/USD pair.

I wouldn’t be at all surprised if we fall back downwards either from the current levels or after testing the 1.48 level. Either way I think there is another good shorting opportunity coming up as soon as we get the next downwards EMA crossover on the 4 hour chart, ie the EMA (5) crossing through the EMA (20).

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