GBP/USD: There is still likely to be opportunities to play the move [Video]

GBP/USD

The acceleration and dramatic nature of the previous sell-off left little real resistance for the recovery. Subsequently, with the bulls running hard, there is little to stand in their way for the recovery. The move has now added as much as +900 pips since the low of $1.1405 last week. Momentum is clearly strongly improving with this move and the bulls remain strong this morning. In fact having made the way quickly through the resistance at $1.2195 (the old October low), there is actually little real resistance until $1.2765 now. We look to buy into intraday weakness on Cable and given that volatility remains huge, there is still likely to be opportunities to play the move. The hourly chart shows initial support in the $1.2130/$1.2230 band above the breakout support area $1.1930/$1.2000. Hourly indicators show minor negative divergences this morning which could mean a near term pullback is threatening to temper the exuberance of this recovery, but we would look to buy into the weakness. Initial resistance at today’s high of $1.2305, with $1.2430/$1.2500 the next realistic resistance.