Forex Technical Update

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GBP/USD

GBP/USD

GBP/USD failed to reach range resistance near 1.5770 and instead fell to range support, trading near 1.54. The positive non-farm payroll was shrugged off, or perhaps it paved way for more USD-strength. Whatever the reason, daily price action is looking heavy, and the support therefore looks shaky especially after a bullish attempt that failed to even reach 1.57.

Support: The next important support is just above 1.53, in the 1.5310-1.5320 area. If we get a bounce, we are likely to get it here rather than 1.54. The 4H chart shows that near 1.53, the market will be trading at this time-frame's lower bollinger band (3 standard deviations below 200SMA). With the bearish bias not particularly strong, we can expect some bounce from this pivot and with oversold condition. Upside expectation however should be limited. A conservative one is to 1.54, and an aggressive one could be to the middle of the range near in the 1.5550-1.5560 area.

A break below 1.53 first opens up 1.5190 (61.8% retracement of the rally from 1.4227 to 1.6745: May 2010-Apr. 2011). Then 1.50, and 1.4788 area next support levels.

GBP/USD

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