The pair has backed off higher prices and is presently weakening for a second day in a row. With the price action taking back most of its rally gains off the 1.6211 level, a return to the that level cannot be ruled.
Below there will clear the way for a move further lower towards the 1.6105 level, its May 18’2011 low and probably lower towards the 1.6000 level, its major psycho level. Its daily RSI is bearish and pointing lower suggesting further declines. Conversely, GBP will have to climb back above the 1.6546 level, its May 31’2011 high to prevent a return to the 1.6211 level, its Friday low.
Above the 1.6546 level will call for a run at the 1.6743 level, its 2011 high and then the 1.6877 level, its Nov’2009 high. A loss of the latter level will pave the way for further strength towards its bigger resistance at the 1.7039 level, its 2009 higher. All in all, with GPP now seen reversing its one-day rally, risk is building towards the 1.6211 level.
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