Leonardo Barata | Oct 19, 2015 07:24AM ET
GBP/USD Total: +145 Pips
In the chart we see that mid-term resistance (previous high) was crossed by wide spread up-bar on high volume.
Resistance – this is a level of previous high, many traders bought near the highs and were locked-in when the price suddenly fell. They are now holding out in the hope of reducing their losses. Locked-in traders want only one thing – to get out of the market at a similar price to the one they first started with. Professional traders that are still bullish know this. To encourage these old locked-in traders not to sell, professional traders will mark-up, or gap up the market, through these potential resistance areas as quickly as possible.
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