The GBP/USD is looking to get above the lid of the 8/13-8/21 range and create some more breathing room between present price and the psychological 1.65 level. Regardless, the Cable still has quite a bit of work to do to the topside due to the BOE's large injection of liquidity a few weeks ago. The pullback from August highs paved a bumpy road for the uptrend, whereas the EUR/USD broke free of its August highs on Tuesday's technical movement. Though lying in the distance, our new 2nd tier downtrend line should serve as a key barometer regarding the health of the GBP/USD's medium-term uptrend. Since our 2nd tier downtrend line runs through August highs, an eclipse of the 2nd tier should indicate a large breakout to the topside. However, we will have to see the data from China before we get ahead of ourselves. Britain will also release its PPI data tomorrow and investors are expecting producer prices to grow by 0.9%. If data should disappoint over the next 24 hours, the GBP/USD has technical cushions in our three uptrend lines along with intraday lows and the psychological 1.65 level. We maintain our bullish near-term outlook on the GBP/USD regardless of any immediate-term pullbacks due to the overwhelming bullish message delivered on Tuesday.
Present Price: 1.6608
Resistances: 1.6608, 1.6635, 1.6657, 1.6668, 1.6701, 1.6722
Supports: 1.6589, 1.6570, 1.6552, 1.6511, 1.6481