GBP-USD Gives Back Corrective Recovery Gains

The following commentary comes from an independent investor or market observer as part of TheStreet's guest contributor program, which is separate from the company's news coverage.

NEW YORK ( fxtechstrategy.com) -- GBP has backed off its Wednesday high at 1.5796 and now trades below the 1.5779 level, its July 12, 2011 low. This is coming on the back of its Wednesday strong rally. GBP needs to hold above the 1.5713/79 levels to convince the market of further recovery higher. This will force further strength toward the 1.5863 level, representing its Sept. 15, 2011 high. Its daily RSI is bullish and pointing higher supporting this view. On the downside, the risk to its corrective recovery will be a return below the 1.5270 level, its hammer candle low. This will resume its medium term downtrend towards the 1.5122 level, its July 18, 2010 low and possibly lower toward the 1.5000 level, its big psycho level. All in all, GBP is biased to the upside on correction though facing price hesitation.

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 The Professional Suite 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.

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