Forex Technical Update
The GBP/USD respected the 1.5660 even though it cracked it at first. The RSI reading in the 1H chart also came back above 60, after failing to sustain a break below 40. The bullish bias and momentum was held, and the market rallied above the range high at about 1.5737, and even cracked the 1.5770 resistance pivot, which is seen more clearly in the daily chart. The 1H RSI reading is also above 70, showing near-term overbought conditions. Also the 1.58 psychological pivot seems to be holding and pushing the market back below 1.5770. If the previous resistance at 1.5737 acts as support, we should expect the market to be able to eventually break above 1.58.
Clear 1.58 opens up the next pivot seen near 1.59 in the daily chart, which is near the daily closes of the consolidation in Oct. to early Nov. 2011. The resistance of this consolidation is near 1.61 and is the next resistance/target level for the bullish continuation scenario in the short-term, in the context of a sideways, congestion market in the medium term that is expanding to more of a range-bound market.
Fan Yang CMT is the Chief Technical Strategist of IBTRADE and FXTimes - provider of Forex News, Analysis, Education, Videos, Charts, and other trading resources.