The GBPUSD continued its bullish momentum yesterday topped at 1.3223. The bias remains bullish in nearest term testing 1.3300/50 region. Immediate support is seen around 1.3160. A clear break below that area could lead price to neutral zone in nearest term testing 1.3125 – 1.3075 area which is a good place to buy. On the upside, a clear break and daily close above 1.3350 would expose 1.3500 region. Overall I remain bullish and only a clear break back below 1.3000 key support would interrupt the bullish outlook.
GBP/USD Charts H1 and H4 both look stretched. A correction appears on the way. That Pound is going up is mainly because the Euro is up and pulling up Pound. Last year this time Pound is roughly traded at the same level, and BOE cut rate and announced more asset purchasing and Pound collapsed. This year many people bet on a BOE hike, which appears unrealistic. BOE is likely going to disappoint. I'm considering to take a bet and put on a small short GBP position before the BOE events, though this carries great risks. If USD looks too much stretched, then Euro might be a good counter part. It looks like EUR/GBP is going to test the 2016-10 GBP flash crash high some time soon. The BOE super-Thursday could be the catalyst to kick-start another leg up, sending this pair on the way to test the 2016-10 high.
The dollar pulled 84 pips out of the pound. At the beginning of the day one British pound was exchanged for $ 1.3198, and the course headed for resistance at 1.3250. By noon the bulls managed to break through and peaked at 1.3265, but three hours later the bears took their bottom at 1.3112. The last quotation for the day was 1.3137.
Pound / dollar was indecisive yesterday. Expectations remain bearish in the short term to test the 1.2930 - 1.2865 zone as part of the downstream phase after the breakthrough under the trendline support line. Resistance for the day is 1.3028 (yesterday's peak). A clear break above this level could take the price to a neutral zone with testing at 1.3075 - 1.3125. Generally, I am neutral on this pair, but a clear break above 1.3125 should re-activate the upward model.
The pound registered a slight increase against the dollar on Wednesday. The British currency broke off the negative trend of the day before, but a key breakthrough was not reached. If the Bears will win again, the first support at 1.2930 will be tested. The session was opened at a rate of 1.2990 and the closing price was 1.3003. The trend was volatile, as the peak of the day was reached at 1.3027.
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