Forex/FX: GBP/USD Technical Analysis Update – 18th December

(Forex-FX-4X.com, Pound/Dollar, Technical Analysis Report, 18/12/2012)

• Cable has broken above the 1.6175 area resistance level on Monday, inline with the recent broad USD weakness scenario, and this area is now viewed as potential support for the GBP/USD pair on any corrective move lower.
• Price is currently trading around the 5/10/2012 1.6216 daily high.  Any continued upside, inline with the prevailing trend, brings the significant double top resistance area around 1.6300 back into focus.  This is a technical point of interest and has proved to be a difficult area to pass when hit on two separate occasions, as per the fig 2 chart below.  
• The last two moves into the 1.6300 area have seen a drop of around 1000 pips and 500 pips respectively with the 21/9/2012 touch of this area printing a price action pinbar reversal formation which marked the high (see fig 1).
• If the market corrects lower, taking out the aforementioned 1.6175 area previous resistance level, the ascending trend-line support shown on fig 1 is an area we will be monitoring.

GBP/USD Analysis – Daily Chart – fig 1

GBP/USD Analysis – Daily Chart – fig 2

GBP/USD, Pound to Dollar Price Action Analysis Update/Forecast