The GBPUSD is encountering sellers right where we thought it might.
On December 3, I wrote about the potential for a breakout from the range ceiling at 1.2980.
Hours later, the GBPUSD closed above 1.2980 and went on a 180 pip run.
But the range break was nothing new to frequent readers of this site.
I discussed the potential for another bullish advance from the British pound on November 18.
The short-term uptrend since September and sideways price action between mid-October and early December suggested strength.
So what needs to happen now?
If you watched my December 3 GBPUSD video, you know that 1.3170 was the target following the close above 1.2980.
You can see how the pair has stalled out a bit around this area.
With that in mind, it’s going to take a daily close above 1.3170 to extend the rally.
Keep in mind that I use New York close charts so that each 24-hour session opens and closes at 5 pm EST.
Go here to get access to the same Forex charts I use.
A daily close above 1.3170 could take the GBPUSD to 1.3340.
But don’t be surprised if we see a rotation lower before the next leg higher can materialize.
That would be the healthier option for this rally, in my opinion.
Regardless of where we go this week, though, I continue to favor GBPUSD longs while the pair is carving higher lows and higher highs.
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