GBPUSD bulls are finally on the move after weeks of consolidation.
Today’s surge isn’t a surprise though.
Since December 21st, I’ve been discussing how the market has refused to sell off from 1.2700 resistance. That alone suggested an eventual move higher.
Furthermore, Friday’s session ended just below 1.2700 after a bearish rejection candle on the 26th.
Another indication that buyers were soaking up all offers below the 1.2700 handle.
But today’s session isn’t over. Far from it.
If you’ve followed me for a while now, you know that I like to use the daily close at 5 pm EST to confirm breakouts like this one.
I use “New York close” charts where each session closes at 5 pm EST. These charts are essential for trading price action.
Go here to get instant access to the same New York close charts I use.
Until a daily session closes (5 pm EST) above 1.2700, today’s rally is open to interpretation.
This is especially true in low liquidity conditions like the ones we’re in right now due to the holiday season.
A daily close above 1.2700 would expose 1.2800 followed by 1.3070.
In fact, there’s a good chance GBPUSD could trend toward the 1.3070 resistance area if buyers clear 1.2700 today.
Here’s why I think so:
This was a comment I made in the member’s area back on December 12th.
It seems channel support is having its way with this market. As such, a move to the confluence of resistance up around 1.3070 seems likely.
But first, GBPUSD buyers need a daily close above 1.2700. A failure to do so would keep the pressure on the 1.2560 support area.
Keep in mind too that the descending channel you see below is inherently bullish. So a move to 1.3070 might be just the start of a larger 2019 rally.
Next year promises to be an exciting one for both GBPUSD and EURUSD.