GBPUSD Analysis – Sep 20, 2008

GBPUSD is in correction to down trend. Further rise to test 1.8480 resistance could be seen next week. As long as 1.8480 resistance holds, we’d expect down trend to resume, and deeper decline towards 1.7000 zone is still possible after correction. However, a break above 1.8480 level will indicate that the down trend from 2.1161 (Nov 9, 2007 high) has completed, and further rebound could be seen to 1.9500 zone.

For long term analysis, GBPUSD is in long term bearish movement. Further fall could be seen to 1.6500-1.7000 area in next several weeks. On the other side, the pair might be forming a cycle bottom at 1.7445 on weekly chart, key resistance is located at 1.8480, a break of this level will confirm the cycle bottom.

gbpusd daily chart