GBP/USD rebounds after pullback from new high
James Chen May 12, 2014 9:27 PM
<p>GBP/USD (daily chart shown below) has shown signs of rebounding after making a sharp, but relatively shallow pullback last week from its new four-year high […]</p>
GBP/USD (daily chart shown below) has shown signs of rebounding after making a sharp, but relatively shallow pullback last week from its new four-year high of 1.6995. That high was just slightly short of its major upside target around the 1.7000 resistance level.
Last week’s pullback brought the currency pair down to a low around 1.6830 support, just above the significant high of 1.6821 that was hit in mid-February. This price action occurs within the context of a sharp bullish trend that has been in place for the past ten months – since the 1.4800-area low in July of 2013.
Still currently well above both its key 50-day and 200-day moving averages, GBP/USD’s sharp upward trajectory over the past year continues to exhibit the pound’s enduring strength against the dollar.
The short-term upside target remains at the 1.7000 psychological resistance level, with any further upside breakout potentially targeting the 1.7250 resistance area.
To the downside, near-term support on any further extension of the price pullback resides around the 1.6750 level and then the 50-day moving average.
StoneX Financial Ltd (trading as “City Index”) is an execution-only service provider. This material, whether or not it states any opinions, is for general information purposes only and it does not take into account your personal circumstances or objectives. This material has been prepared using the thoughts and opinions of the author and these may change. However, City Index does not plan to provide further updates to any material once published and it is not under any obligation to keep this material up to date. This material is short term in nature and may only relate to facts and circumstances existing at a specific time or day. Nothing in this material is (or should be considered to be) financial, investment, legal, tax or other advice and no reliance should be placed on it.
No opinion given in this material constitutes a recommendation by City Index or the author that any particular investment, security, transaction or investment strategy is suitable for any specific person. The material has not been prepared in accordance with legal requirements designed to promote the independence of investment research. Although City Index is not specifically prevented from dealing before providing this material, City Index does not seek to take advantage of the material prior to its dissemination. This material is not intended for distribution to, or use by, any person in any country or jurisdiction where such distribution or use would be contrary to local law or regulation.