GBP/USD had a sharp fall in the earlier hours of Wednesday, only to reverse and shoot straight up after the Federal Reserve’s promise to keep rates low until the end of 2014. Negative GDP numbers saw the pair falling in the morning though, and over time, this should be a serious concern for the markets involving the pound.
The pair is quickly approaching the massive resistance area of 1.57 to 1.58, and this is an area that we have been watching to see if selling is possible. The move upward has been parabolic, and underlying weakness in the UK will eventually weigh against the Pound. We will wait for weakness to sell, and won’t buy ahead of it. We simply wait to see the reaction to the area, and if we get the weakness – we are sellers.
GBP/USD Forecast January 26, 2012, Technical Analysis
Originally posted here
