The Daily chart depicted above reflects that the GBP/USD pair could break its long-term downtrend line of January. Since then it has been trading within an uptrending despite some sideways consolidation in November and March.
Although the GBP/USD pair showed a significant bearish reaction towards 1.5950 - 1.6000 which gave some bearish expectations, the pair has failed to break through the level1.5830 which allowed the bulls to make a strong push to the upside and break 50% Fibonacci level (1.5925) and 1.5980-1.6000 ( Resistance level and Supply Zone)
It is important to mention there was a short-term uptrend line that was broken in the first week of April which was being tested at 1.6125 last Friday which is expected to constitute a soild resistance level to prevent the further upside movement up to the retesting of 1.5930 - 1.5980 (newly formed support zone) takes place constituting a long-term BUY entry.
At the moment it is recommended to stay outside the market until this support zone has not been reached. However, SELLING the GBP/USD at 1.6125 with a small lot size is still valid targetting 1.6000 with SL placed above 1.6170.
Price Zone 1.5930 - 1.5980 is recommended as a valid Long-term BUY entry with SL located below 1.5810.
The material has been provided by Instaforex Company - instaforex.com
