GBPUSD: Biased To The Downside Despite Correction.

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GBPUSD: Though a higher close was registered on Monday ,it came in form of a shooting star candle pattern(top reversal signal).This is coming on the back of a rejection of higher price at the 1.6192 level, a level that also habours the pair's daily 200 ema. This candle pattern could trigger downside weakness(seen marginally in early trading today) and subsequently clear the way for more downside towards its Jan 07'10 low at 1.6056 with a turn below there aiming at the 1.5830 level, its Dec 30'09. Below the latter level will set the stage for the resumption of its declines activated off the 1.6875 level towards the 1.5706 level, its Oct 13'09 low. A sustained break below there will see a 100% price retracement (from 1.5706- 1.6875 levels) and open the door for additional downside towards its .50 Ret (1.3501-1.7041 rally) at 1.5273. Conversely, above the 1.6234/39 levels will have to be traded to reverse GBP's downside view and open up upside risk towards the 1.6409 level, its Dec 16'09 high where a break will expose its Nov 25'09 high at 1.6744 and then the 1.6875 level, its Nov 16'0-09 high. These levels should provide strong resistance if seen and possibly turn the pair back down. Overall, GBP remains vulnerable to the downside towards the 1.6056/1.5830 levels.

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