Attached is the 1H chart for GBPUSD. Like EURUSD, it has also made a nice retracement and has been making its upward march for the past few days. True to its character, we have had some violent moves in this pair this week with both the move down and the subsequent move up being equally violent. Honestly, at the beginning of the week, i expected this pair to move down a lot but it has shown surprising strength and has come right back up to its previous top.
This pair is now at a crucial point. The previous top is nearby at 1.6650. It was from here that we had a 800 pip drop the previous time. Now, we need to see whether this top is going to be taken out or not. If it is not, then we are again going to go down. If this top is indeed taken out, then we are on our way again to very high levels.
On the downside, we have good support at 1.6540 and then at 1.6480 and finally at 1.6420. This price should prove as a very strong support and i dont see price going down below this today.
On the upside, as pointed out above, we have huge resistance at 1.6620 and then a bigger one at 1.6661. If this is taken out, then we should have atleast a 300-400 pips move above in the next few days.
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