Forex Technical Update

Previous: GBP/USD - Declining Channel Intact as Correction Rally Fails 1.56 (11/28)

GBP/USD

GBP/USD

The GBP/USD cracking a declining channel established in November. The 4H chart shows that this also broke above 23.6% retracement of the 1.6165-1.5415 bear run that started late October into Thanksgiving week. The rally that started this week is following through, and November's bearish momentum is being tested as the RSI knocks at 60. A break above that confirms the market anchoring out of the channel, at least for a range-bound market, if not a bullish one this week.

With the Non Farm Payroll release ahead on Friday as an important even risk, we can anticipate some loss of USD strength we seen during this month.

The next resistance level to look for is the 38.2% retracement at 1.57. As this is at the momentum categorized as a corrective move, the most we should expect is a rally to 1.5790, 50% retracement.

Support at 1.5590-1.56 helps build the case for the correction scenario toward 1.5790.

 Fan Yang CMT is the Chief Technical Strategist FXTimes - provider of Forex News, Analysis, Education, Videos, Charts, and other trading resources