# GBP/USD: Retracement Setup (January 6, 2014)

Source: https://www.tradersway.com/resources/market-info/gbp-usd-retracement-setup-january-6-2014/
Language: en
Updated: 2014-01-06

GBP/USD has broken past the 1.6500 handle last December but failed to sustain its rallies until the start of this year. This suggests that a huge retracement might be in the cards, as the pair gathers more buying power.



The 50% Fibonacci retracement level lines up with an area of interest. As you can see from the chart, the level is also close to the 1.6200 major psychological support level.



![GBP/USD: Retracement Setup (January 6, 2014)]



Going long at 1.6225 with a stop below 1.6200 or the 61.8% Fib level could provide the pair enough leeway for a pullback. Stochastic is already in the oversold region, which means that sellers are already exhausted. Aiming for the 1.6500 mark seems to be a reasonable target and could yield roughly a 3:1 return on risk.



*By Kate Curtis from Trader’s Way*