Bullish GBPUSD, Good First Entry for Possible Big Picture Breakout Later
The decline in cable off the May high is making it an interesting prospect as a long. In recent webinars, we discussed a retest of a trend-line coming down off the May peak. (You can sign up here for the Friday webinar.) Not only is there trend-line support, but due to the timing there is confluence with a swing-high set in the middle of June. So far, we are seeing GBPUSD push higher off this area of support and expectations are for it to trade back higher towards the 13000-line again (and higher).
If today’s pop off support fails, we will look again to see how price action takes shape at an even more important area of support just below 12800. So, while the first attempt might not hold success, not all will be lost if we can establish a profitable position later on at lower levels.
The first target is set at 13010, just below resistance in the vicinity of 13030/50. Looking bigger picture, a clean breakout into the 13000s could hold strong implications as there isn’t anything to the left on the chart until swing highs created from June to September of last year around the 13400/3500 area. Overall, an entry from here is viewed as a low-risk way to join in on a possible macro-move higher…
Entry: Long at current levels
Stop: 12795 (below today’s low)
Target: 13010 initially, 13400/500 on a break above May high
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---Written by Paul Robinson, Market Analyst
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