Our view on Sterling is a bullish market in coming days as long as the trend is still moving above the region of 1.3490 - 1.3500.
The GBP/USD pair rose from the level of 1.3490 to a top around 1.3710. But, the GBP/USD pair failed to settle above the resistance at 1.3710 and pulled back from the last bullish wave.
Today, the first resistance level is seen at 1.3710 followed by 1.3760, while daily support 1 is seen at 1.3490 (61.8% Fibonacci retracement).
Yesterday, the GBP/USD pair broke resistance at 1.3583 which turned into strong support yesterday. This level coincides with 78% of Fibonacci retracement which is expected to act as major support today.
Equally important, the RSI is still signaling that the trend is upward, while the moving average (100) is headed to the upside. Accordingly, the bullish outlook remains the same as long as the EMA 100 is pointing to the uptrend.
This suggests that the pair will probably go above the daily pivot point (1.3583) in the coming hours.
The GBP/USD pair will demonstrate strength following a breakout of the high at 1.3583.
Consequently, the market is likely to show signs of a bullish trend. In other words, buy orders are recommended above 1.3583 with the first target at 1.3710.
Then, the pair is likely to begin an ascending movement to 1.3760 mark and further to 1.3820 levels in coming three days. The level of 1.3820 will act as strong resistance, and the double top is already set at 1.3710.
On the other hand, the daily strong support is seen at 1.3490. If the GBP/USD pair is able to break out the level of 1.3490, the market will decline further to 1.3270 (daily support 3).
On one-hour chart :
The trend of GBP/USD pair movement was controversial as it took place in the uptrend channel.
Due to the previous events, the price is still set between the levels of 1.3490 and 1.3710, so it is recommended to be careful while making deals in these levels because the prices of 1.3710 and 1.3490 are representing the resistance and support respectively.
Therefore, it is necessary to wait till the uptrend channel is passed through. Then the market will probably show the signs of a bullish market.
If the pair fails to pass through the level of 1.3490 (major support), the market will indicate a bullish opportunity above the strong support level of 1.3490.
In this regard, buy deals are recommended lower than the 1.3490 level with the first target at 1.3710 . It is possible that the pair will turn upwards continuing the development of the bullish trend to the level 1.3720, then continue towards the next objective of 1.3820.
However, stop loss has always been in consideration thus it will be useful to set it below the last bearish wave at the level of 1.3490 (notice that the major support today has set at 1.3490).
*The market analysis posted here is meant to increase your awareness, but not to give instructions to make a trade.
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