FXstreet.com (Barcelona) - The Pound rallied last week from 1.5700 to 1.6400 high, forming a bullish engulfing candle on the weekly chart, which, according to Nicole Elliott, senior technical analyst at Mizuho Corporate bank cancels previous downside pressure.

On the long term, Elliott sees the Pound trending higher, after its bounce at Fibonacci retracement support: Last week's rally from first medium term Fibonacci retracement support (38%) formed a large 'bullish engulfing' candle on the weekly chart, culminating in a close above the 'neckline' of an irregular 'head-and-shoulders'. This pretty much cancels out the downside pressure supplied by this chart formation and underlines the fact that the very long term trend for Cable is higher.

Resistance levels, according to Elliott, lie at 1.6371, 1.6401 and 1.6585. On the upside, support levels lie at 1.6281, 1.6253 and 1.6197.