Forex Technical Update
GBP/USD 1H Chart 6/27/2012 10:15AM EDT
Risk aversion from the EU summit is pushing up the US Dollar and dragging the British Pound.
Looking at the 1H chart, we see that the GBP/USD is bearish. Price action has made lower highs and lower lows. The RSI failed to push above 60, and has returned back below 40 about to tag 30 again. These are signs that the market is developing bearish price action and momentum. New lows on the day during the 6/28 US session also suggests that the bearish bias remains.
A break of the 1H RSI above 60 as well as price pushing back above 1.56 would invalidate this bearish outlook.
The 4H chart shows some key levels to monitor for possible support. The 1.54-1.5430 area contains some support/resistance pivots. Below 1.54, we have the 1.5280 June low as a possible target, as well as a level to expect some short-term support. The 1.5240-1.5280 area has provided support not just in June 2012, but also Jan 2012, Sept/Oct 2011, and Sept. 2010.
GBP/USD 4H Chart 6/27/2012 10:15AM EDT
Fan Yang CMT is a forex trader, analyst, educator and Chief Technical Strategist for FXTimes - provider of Forex News, Analysis, Education, Videos, Charts, and other trading resources.
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