GBP/USD outlook: Bulls pause for consolidation after uninterrupted seven-day rally

Slobodan Drvenica Windsor Brokers

GBP/USD

Cable edged lower on Thursday, as bulls take a breather after strong rally in past two days (part of larger seven-day rally) that hit two-month high (1.3589) on Tuesday and probed above the top of thickening daily Ichimoku cloud (1.3561).

Overbought daily studies contributed to a partial profit-taking, with dips expected to be limited (ideally to be contained at 1.3500 zone, consisting of broken 50% retracement of 1.3869/1.3159 descend / Tuesday’s low and deeper pullback to find ground above daily cloud base at 1.3450) to provide better levels to re-enter bullish market.

Bullish daily technical picture comes along with growing optimism for peace solution in the Middle East that already boosted risk appetite and would lift pound further on fresh signals of conflict de-escalation.

Immediate resistance lays at 1.3600 (round-figure / near Fibo 61.8%), break of which would open way for 1.3700+ gains.

Res: 1.3561; 1.3589; 1.3600; 1.3662.
Sup: 1.3500; 1.3488; 1.3450; 1.3420.

Author

Slobodan Drvenica

Windsor Brokers

Industry veteran with over 22 years’ experience, Slobodan Drvenica joined Windsor Brokers in 1995 when he was an active trader for more than 10 years, managing the trading desk and own account departments.

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