GBP/USD Technical Analysis October 25, 2011

The GBP/USD pair rose on Monday, and even retested the 1.60 level. The area held as resistance during the late hours of the session, and the recent consolidation in August at this level shows that we may have hit a very tough spot for the bulls. If we could close above the 1.60 level on the daily chart, this would be massively bullish, and even more so if we close above 1.61 as well. The pair looks set for a pullback from this formidable level, so we are watching the hourly and 4 hour timeframes for sell signals. The 1.60 area is also the 61.8% retrace of the latest plunge to the downside. Needless to say, this area is important.

Written by FX Empire