This morning the GBP USD is trading lower following last week’s spectacular closing price reversal top. Based on the short-term range of 1.5345 to 1.6400, expectations are for a test of the retracement zone at 1.5873 to 1.5748.

The shedding of risky assets put downside pressure on the December E-mini S&P 500 this week, leading to the formation of a closing price reversal top. This pattern often leads to the start of a 2 to 3 week break of about 50% of the last rally. A move through 1191.50 is needed to confirm the reversal top; otherwise it could go into sideways mode.

U.S. stock index futures traded sideways to lower on Wednesday after confirming Tuesday’s closing price reversal tops. The topping pattern that may be developing usually leads to a minimum 2 to 3 day break equal to 50% of the last rally.

December Gold and December Silver broke sharply after investors shed risky assets amid an impressive turnaround in the U.S. Dollar.

Technically the closing price reversal top in Gold indicates further downside pressure is likely. Based on the recent rally, expectations are for a possible correction into $1370.00 to $1357.10. Often this type of move is fast and furious and lasts 2 to 3 days.