The GBPUSD has moved sharply higher this week and in the process extended above a swing area near the 1.2950 to 1.3000 this week. The price also moved above a topside trendline near that area (see green number circles on the chart below). The run to the upside yesterday and today stalled right near the low of the next swing area target that comes between 1.31465 and 1.3221 (see red number circles on the chart below). The high price today reach 1.31415 and we are seeing modest declines offer that level. The current price trades at 1.3115.
The buyers took control. There were big breaks to the upside technically. On a daily chart it would take a move back below the 1.3000 level to tilt the bias back to the downside. Having said that, if traders can lean against 1.31465 with limited risk, it might give traders a cause for pause after the sharp rise to the upside. At the very least traders can define and limit their risk against that level. If the price goes above it, get out. If the price stays below, look to 1.2950 and 1.3000 as a support target.
This article was written by Greg Michalowski at www.forexlive.com. Source