GBP/USD at Support/Resistance Pivot

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GBP/USD at Support/Resistance Pivot

The GBP/USD has been rallying in February from about 1.50 up to 1.5550 last week. This week, there has been a bit of a retreat. Let’s take a look at the technical picture ahead of the BoE on Thursday and US NFP on Friday.

The 4H chart shows the GBP/USD testing the 1.53-1.5350 area, which was a support/resistance area. A hold above 1.53 should maintain a bullish outlook, but what about below 1.53. We should take a step back to the daily chart and look at the big picture in preparation to Thursday BoE decision and Friday’s US NFP.

We can see that cable rallied from a low on the year at 1.4950 to 1.5550. This establishes a consolidation range so far, and the central pivot is in the 1.5223-1.5270 area. This is the area we should monitor. If the week closes above it, there should be more consolidation/bullish correction next week. Below it, we should look for a bearish continuation attempt at least to threaten 1.4950, with risk of falling towards 1.49.

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Fan Yang has been a professional forex trader and analyst since 2007. He specializes in technical analysis and has a Chartered Market Technician designation since 2011. He was the chief technical strategist at CMSFX He was also the founder and chief currency strategist at FXTimes Over the years, Fan has not only been a trader and analyst but also an educator. As a proponent of both technical and fundamental analysis in trading, Fan advocates simplicity and discipline as key factors in making trading decisions when faced with so many "clues" and "signals". Currently Fan Yang is the chief currency analyst and webinar instructor at forexminute.com.