By Mohammed Isah of fxtechstrategy.com
: As the pair continues to extend its declines initiated from its Nov. 16 low at 1.6875, we expect further downside toward the 1.5706 level, the Oct. 13 low.
to view a chart of the currency pair.
A breach will see a 100% price retracement (from 1.5706-1.6875 levels) and open the door for additional downside toward its .50 Ret (1.3501-1.7041 rally) at 1.5273.
The pair's daily relative strength index is bearish and pointing lower, suggesting further downside.
Conversely, immediate resistance lies at the 1.6000 level, but the pair must trade above its Nov. 25 high at 1.6744 and its Nov. 16 high at 1.6875 to reverse its current downside threats and bring further gains toward the year-to-date high at 1.7041. There, a decisive invalidation will resume its medium-term uptrend toward its .50 Ret (2.1160-1.3501 decline) at 1.7314.
Overall, GBP-USD remains vulnerable to the downside, with the next key support level at 1.5706.
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.