By Mohammed Isah of fxtechstrategy.com
NEW YORK (
) -- A follow-through higher in early trading Monday saw the pound-dollar currency pair (GBP-USD) break above the 1.5906 level to build on its recovery that started at the 1.5344 level.
However, we would like to see the currency pair hold firmly above 1.5906 on a daily closing basis to convince the market of a valid breakout. This would trigger further upside momentum toward the pair's its Nov. 12 high at 1.6183 with a cut through there clearing the way for a further push toward its November high at 1.6298.
The pound-dollar pair's daily studies are bullish and pointing higher, supporting this view.
On any pullback, however, support stands at 1.5718, the Jan. 13 low, with a breach of that level allowing for more weakness toward 1.5660, the pair's December low. A reversal of roles is expected there.
Overall, the pound-dollar pair continues to press higher, building on its bullish recovery from the 1.5344 level.
--Written by Mohammed Isah.
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Mohammed Isah is a technical strategist and head of research at FXTechstrategy.com, a technical-research Web site. He has been trading and analyzing the foreign exchange market for the past seven years. He formerly traded stocks before crossing over to the forex market, where he worked for FXInstructor LLC as a technical analyst and head of research before joining FXTechstrategy.com. He has written extensively on the forex market and technical analysis and his articles have been featured in The Technical Analyst Magazine, The Forex Journal Magazine, The International Business Times and FXstreet.com. At FXTechstrategy.com, he writes daily, weekly and long-term technical commentaries on currencies and commodities, which are offered to its clients. He also produces
for his subscribers. He provides full coverage of the forex market with specific focus on G10 currencies as well as the commodities markets, with focus on five key commodities.