GBP-USD: Immediate outlook for GBP has turned consolidative to corrective after selling off from the 1.6456 level on Jan. 17 to the 1.5556 low on Friday. While the pair retains its broader weakness triggered off the 1.7041 level, its Aug. 9 high, risk of corrective recovery was seen in early trading today following price hesitation off the 1.5532 level.
On a follow through, we should see the pair head higher toward its Oct. 13, 2009 low/range lows at 1.5706, where a reversal of roles is expected to push it back down again. Other resistance levels beyond there are located at the 1.5830 level, its Dec. 30, 2009 low and its psycho level at 1.6000.
On the other hand, if its vulnerability to the downside should continue, it will retarget its intraday low at the 1.5532 level, with a turn below there resuming its weakness toward the psycho level at 1.5400, followed by the 1.5276 level, with a break pushing the pair further lower toward its early May 2009 low at 1.5057.
Its weekly and monthly studies are supportive of this view, as they are pointing lower. On the whole, although the pair's medium-term downtrend remains intact, it faces immediate risk of consolidation to correction.
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.