We have seen a rally of the 126.75 low. However, we still need a clear break above minor resistance at 129.31 and more importantly, a break above resistance at 130.06. At present, the pair is building a bottom.

So, for now, we should expect minor support at 127.70 that can protect the downside for another test of minor resistance at 129.31 and a break above should open the upside for a firm test of resistance at 130.06.

Only an unexpected break back below support at 126.78 will spoil bullish count once again.

R3: 130.06

R2: 129.64

R1: 129.31

Pivot: 128.75

S1: 128.00

S2: 127.70

S3: 127.33

Trading recommendation:

We bought GBP at 127.80 and we have placed our stop at 126.70