GBP-USD: Faces Near-Term Weakness

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) -- Although the pound-dollar currency pair continues to remain vulnerable to the downside following its selloff on Friday, its broader medium-term bias still points higher.

As long as GPD-USD can trade and hold above the 1.5642/1.5653 levels, which mark its Feb. 14 and Feb. 15 lows, respectively, it should eventually return above the 1.5924 level, its Feb. 8 high, and then the 1.5990 level.

If this happens, it will pave the way for a run at 1.6074, the November 2011 high, and maybe even the Oct. 31 high at 1.6161.

On the downside, the risk to this medium-term outlook will be a continued weakness targeting the 1.5642/1.5653 levels, its Feb. 14/Feb. 15 lows.

This zone is expected to hold when tested. However, if it is violated, further lower prices will shape up towards the 1.5497 level, GBP-USD's Jan. 10 high.

On the whole, though still maintaining its medium-term uptrend, GBP faces downside threats.

-- 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 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.