GBPUSD continues to grind higher after providing us with two profitable setups last week. During yesterday’s session the pair managed to climb above yet another resistance level at 1.5550. This level previously acted as resistance on February 26th and June 10th and also capped the bullish advance on June 12th.
With the cable now 45 pips above the 1.5550 handle the outlook becomes pretty clear. Any rotation back to this level will likely be met by increased buying pressure which of course provides us with an opportunity to go long.
To the upside, the 1.5680 level could prove difficult for the bulls as the area previously acted as resistance between May 21st and the 22nd. Beyond that we have the current 2015 high at 1.5814.
Although a bit speculative this early in its development, the weekly chart does hint at the possibility of a major reversal pattern that has been taking shape since January. If this is the case (and it’s a big if) it would put the pair back in the 1.6750 area over the next several months.
For now though it’s best to focus on the levels at hand, which includes support at 1.5553 along with resistance at 1.5680.
Summary: Watch for bullish price action on a retest of 1.5553 as new support. Key resistance comes in at 1.5680 and 1.5814.
In addition to GBPUSD, GBPCAD has been a profitable pair to trade recently. The pair carved out a favorable setup last week in the form of a bullish pin bar at the 1.8955 key support level.
This level can be seen acting as support and resistance earlier in the year and more recently acted as support on several occasions between May 19th and June 10th.
The June 9th pin bar was an obvious setup and also triggered a 50% entry for those who traded it. The key resistance level and target at 1.9185 meant that we were able to secure a profit of 3.25R last week. That’s a 6.5% profit if risking 2%.
However GBPCAD doesn’t appear to be done just yet. The pair continued to put pressure on the 1.9185 area during Monday’s session and finally managed to close well above the key level.
Summary: Watch for bullish price action on a retest of 1.9185 as new support. Key resistance comes in at 1.9300 and 1.93800.