GBPUSD 25th March – Rebound After the Big Fall?

by Nick Simpson, Forex-FX-4X

GBPUSD 25th March – Technical Analysis – 25/3/13

• GBPUSD is trading around the 1.5260 area. This is a key technical point of interest and it marks the previous support lows as can be seen on the weekly timeframe chart below.
• This area has potential to see an element of resistance as previous demand can sometimes turn into supply.  However, we also note the following:
  • The weekly candle from last week was a bullish engulfing, where the real body engulfed the prior week.
  • Price has now taken out the recent range resistance high which are located just under this previous demand area.
  • Cable has moved marginally above the 23.6% Fibonacci level of the last significant leg lower.

• Nonetheless, we will be monitoring the price action in this area for any sign of near term weakness.
• We also note that a strong move above this area would encourage the GBPUSD bulls and could mark a shift back into the longer term range consolidation scenario.
• See the pound/dollar W1 and D1 charts below for reference.

Click to enlarge