GBP/USD Technical Analysis: Sterling Strength Prevails
Dailyfx | Sep 11, 2015 01:35AM ET
Talking Points:
- GBP/USD Technical Strategy: Flat
- GBP/USD strength after an extended move last week.
- Short positions could be attractive should resistance show in the 1.5500 zone.
USD throughout the week after the sharp bounce off of the 23.6% Fibonacci retracement of the July 2014-April 2015 major move (shown in red-dashed lines on the chart). The strength in the pair over the past week has seen multiple long-term resistance levels yield to surging prices, including the 23.6% retracement of the long-term major move (shown as a green line on the chart, taking the Fib from the 2.1160 high to the financial collapse low at 1.3500), and the 50% retracement of the intermediate-term move (financial collapse low to the July 2014 high).
From here, resistance in the 1.5500 zone could prove attractive, as this offers both prior swing-low support as well as potential resistance from the 50% Fibonacci retracement of the most recent major move (indicated by dashed-gray lines). If 1.5500 yields, then potential resistance at 1.5567 and 1.5600 could become attractive; and if prices break above the 1.5750 psychological level, short stances should be abandoned as higher-highs would then look promising.
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