GBPUSD: Having halted its nearer term
recovery at 1.5239, which started from its 2010 low at 1.1875 to close lower
the past week, further extension of that weakness is presently seen targeting
the 1.4872 level, its July 01’10 low. A firm violation of there will push the
pair further lower towards the 1.4768 level, its Jun 02’10 high. We expect a
reversal of roles to occur at this level thus turning GBP back up again.
Conversely, to reverse its present weakness, a violation of its July 08’10 high
at 1.5239 will have to occur to create scope for more upside towards its falling
trendline presently located at the 1.5311 level. This level is expected to
present a considerable resistance on an initial test and turn the pair back
down. However, on further gains beyond that level, strength should build up
towards its psycho level at 1.5400 and then its April 15’10 high at 1.5521.
Overall, though presently undergoing correction, as long as the pair holds
above the 1.4768 level, its nearer term uptrend triggered from the 1.1875 level
remains valid.
