Forex: GBP/USD trades on consolidation mode above 1.6110

 @ibtimes
on December 31 2009 5:39 AM

FXstreet.com (Barcelona) - After trading higher against the Dollar from 1.5830 yesterday low to reach 1-week high at 1.6150 in a 320 pips recovery movement, the Sterling is trading in consolidation mode moving in range between 1.6110 and 1.6140.

Currently the pair is pricing at 1.6135, rising 0.35% so far today from opening price action at 1.6075.

Peter Rosenstreich, analyst at ACM, comments: Yesterday's sharp rebound from 1.5833 lows has completely negated the break of 1.5925 support, and indeed the subsequent demand for GBP into year-end has ensured GBPUSD climbed back above the 200 day moving average at 1.6066 with ease, and has now overshot the upper bound of the recent ranges to trade up to 1.6151 highs so far. 1.6200 will cap most rallies for now, but above there expect very little significant resistance until 1.6340 (10 day moving average). Support should now come in at 1.5833, and the critical 1.5708 support level below.

The ecPulse.com analysis team affirms: The pair rushed to the upside steeply yesterday to continue the upside correction reaching 61.8% while trading above the support level for the descending channel. Momentum indicators are providing negative signals supporting the strength of the correction level and therefore we expect a downside intraday move today targeting initially 1.5975 and then 1.5920 and require 1.6155 to remain intact with four hour closing.

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