GBP/USD Price Analysis: Bulls back in the driving seat through daily resistance
- GBP/USD bulls are on the march and have burst through daily resistance.
- The 4-hour chart's environment is now bullish as MACD crosses above zero.
The monthly chart is showing signs of exhaustion at a critical resistance level in the recent dollar strength and the subsequent drop in cable.
However, there could still be some juice left in the price to the upside before a meaningful monthly downside correction.
The following is a top-down analysis that illustrates the market's structure and price action across various time frames driving at a potential upside opportunity on the daily and 4-hour time frames.
Monthly chart
Weekly chart
The weekly chart has already corrected a 38.2% Fibonacci retracement of the weekly bullish impulse. This is significant enough to expect a bullish continuation although there are still prospects of a downside continuation until at least a 38.2% Fibonacci retracement has been reached.
Daily chart
The recent break of the resistance is compelling.
The daily chart is now aligning with the weekly and monthly charts as the price moves away from dynamic trendline support.
Regardless of whether the monthly chart still needs to correct further, there are prospects for a daily continuation.
4-hour chart
The 4-hour chart is showing bullish conditions with MACD above zero and the price rallying trough resistance and away from the 10 moving average.
A pullback to restest the old resistance structure would now be expected to hold.
In doing so, then the monthly, weekly and daily alignments would reinforce the bullish bias on the lower time frame.
Author
Ross J Burland
FXStreet
Ross J Burland, born in England, UK, is a sportsman at heart. He played Rugby and Judo for his county, Kent and the South East of England Rugby team.
