Overview :
- The British pound has rallied quite nicely early to recapture the 1.3764 level. The level of 1.3764 is coincided with the ratio of 38.2%.
- Any subsequent positive move might confront some resistance near the 1.3764 mark. This is closely followed by the 38.2% Fibo. level, around the 1.3764 region, which if cleared decisively will negate the near-term positive bias.
- The pair might then accelerate the momentum back towards the 1.3800 mark before eventually climbing to monthly tops, around the 1.3780-1.3800 area.
- Strong support will be found at the level of 1.3774 providing a clear signal to buy with a target seen at 1.3823.
- If the trend breaks the minor resistance at 1.3823, the pair will move upwards continuing the bullish trend development to the level 1.3863 in order to test the daily resistance 2.
- The GBP/USD pair is showing signs of strength following a breakout of the highest level of 1.3863.
- On the H1 chart. the level of 1.3794 coincides with 50% of Fibonacci, which is expected to act as minor support today. Since the trend is above the 50% Fibonacci level, the market is still in an uptrend.
- But, major support is seen at the level of 1.3764. Furthermore, the trend is still showing strength above the moving average (100).
- Thus, the market is indicating a bullish opportunity above the above-mentioned support levels, for that the bullish outlook remains the same as long as the 100 EMA is headed to the upside.
- The idea of buying dips and most certainly would like the idea of buying a breakout the 100 day EMA. The next major target would be the 1.3918 level.
- On the downtrend :
- However, if we were to break down below the 1.3918 handle, it would not only break a major psychologically important level, but it would also break the 200 day EMA, something that would certainly be worth paying attention to.
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