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Forex pairs in this Article » GBP/USD
By: DailyForex.com

Last Monday's analysis ended like this:

1. Price could get to 1.6000 and beyond soon.
2. The level at 1.6000 should be key psychologically.
3. Likely to be strong resistance at 1.6250 to 1.6300 which is long-term swing high.
4. If instead the weekend gap fills quickly before we reach 1.6000, price is likely to fall to one or some of the following levels: 1.5825, 1.5750, and 1.5718.
5. If 1.5825 breaks to the down side, a short trade down to 1.5750 and possibly 1.5718 becomes practical.


It is impossible to judge these forecasts as none of these scenarios have come to pass yet! The action has been quiet so far this week, but there is going to be key GBP and USD news today which is likely to provide some movement for this pair.

The weekend's gap has just barely filled. Monday was bearish and yesterday was indecisive. This week so far the trading range has been less than 80 pips, as we can see from the daily chart below:

GBPUSD Daily 91813


The only development it is possible to talk about since the last analysis two days ago is that although the weekend gap has just about filled, the resistance zone just below where the price is right now, above which the price had gapped, is still holding. This could be a bullish sign, but with such relatively thin action it is hard to judge.

The next area of major resistance is more than 200 pips above where the price is now, so there is plenty of room for bullish continuation.

However nothing is likely to happen until the major GBP news this morning, followed by important USD news this evening.

In the meantime we can more or less repeat the summary from last Monday as our guide to price:

1. Price could get to 1.6000 and beyond soon.
2. The level at 1.6000 should be key psychologically.
3. Likely to be strong resistance at 1.6250 to 1.6300 which is long-term swing high.
4. If the price first falls through the support at 1.5879, price is likely to break down to one or some of the following levels: 1.5825, 1.5750, and 1.5718.
5. If 1.5825 breaks to the down side, a short trade down to 1.5750 and possibly 1.5718 becomes practical.


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