GBPUSD-Hitting Its Channel Resistance

GBPUSD - With a marginal close seen Monday following a retest of its falling channel resistance, another attempt was seen being made at the same resistance today. GBP continues to struggle within the mentioned channel since breaking into it the past week following its failure at the 1.6692 level, its Oct 23'09 high. A clearance of that level and the 1.6466 level, its Sept 23'09 high must occur to reverse its weakness and open up upside risk towards the 1.6740 level, its Sept 11'09 highwhere a break higher will pave the way for a run at its YTD high at 1.7041. We believe that while the pair continues to trade within its channel, its upside will remain on hold and downside risk is likely. Support is located at its Sept 30'09 high at 1.6124 where a break will create scope for further weakness towards the 1.5708 level printed on Oct 13'09. Below there will trigger the resumption of its short term downtrend. On the whole, while GBP trades within its falling channel, risk remains to the downside with eyes on its short term downtrend resumption.