The GBP/USD pair initially fell during the Monday session, only to bounce back and form a bit of a hammer on top of the massive green candle from Friday. This looks as if the 1.56 level will offer support at this point in time, and we will run to the 1.57 level. Once we get above the 1.57 level, we feel that there is resistance all the way to 1.58 but beyond that we should hitting air pocket in see this pair climb another three or 400 pips without much hesitation.
It is in this environment that we look at the British pound, but have to admit that the 1.578 to the 1.58 level looks extremely resistive. Is because of this that we feel more than likely we will see another gain of about 75 pips or so, only to fall back down within the trading range down to the 1.55 level or so.
Written by FX Empire