GBP/USD Forecast June 25, 2013, Technical Analysis

The GBP/USD pair had a positive session on Monday as the markets came back to retrace some of the losses that the market had on Friday. That being the case, we did have another positive motion to hit the 1.5450 level, but as you can see on the chart attached to this article, the 200 day moving averages just above the 1.55 level, an area that had once been significant support.

Because of this, we feel that the market will more than likely make an attempt at that area, but it would not surprise us at all to see this market fall from that level. After all, one of the basic tenets of technical analysis is that “what was once support, now becomes resistance.” That being the case, we fully expect that right now, because of various reasons, but it appears that the US dollar is retracing some of this recent strength in general.

Because of this, we feel this is more or less the US dollar taking a break, and nothing more. We don’t expect sudden British pound strength, and judging by the way the FTSE has been acting lately, we have a hard time believing that there will be Pound strength anytime soon. (For those of you who don’t look at the European stock indices very often, the FTSE is absolutely coming apart.)

Looking at the shape of the candle for the session, it isn’t necessarily handle, and we don’t necessarily think this candle is overly convincing. However, looking at the US dollar on the whole, it does appear that the Dollar will take a little bit of a breather over the next session or two. In other words, we feel that any move above 1.55 will run into resistance, we are more than willing to sell that area on a resistive candle. In fact, we fully expect this market heads down towards the 1.5250 level fairly soon, and possibly even lower, targeting the 1.50 handle. As far as buying is concerned, we don’t have any plans to do so at the moment, but however we do of course have to adjust our trading plans if all of the sudden it appears this market is going to take off to the upside. That being said, we don’t expect to have to worry about that.


GBP/USD Forecast June 25, 2013, Technical Analysis

Written by FX Empire