Is GBPUSD a buy following last week’s breakout?
I’ll share my thoughts in today’s video, and provide an update on the US Dollar Index (DXY).
All eyes are on 1.2770 this week following last week’s breakout.
We’ve discussed the multi-year consolidation from pairs like GBPUSD and EURUSD in recent weeks, so now it’s time to see if buyers can follow through.
As mentioned in Monday’s EURUSD video, I’m skeptical about last week’s breakout, given the lack of momentum early this week.
Furthermore, last week’s break from the euro and pound occurred on Friday, the day after a US holiday, so volume was much lower than usual, and volume equals conviction.
With that said, GBPUSD remains above 1.2770 at the time of this writing, so I have to respect that fact.
Only a sustained break below the 1.2770 area on the higher time frames would pique my interest for a short toward 1.2690 and 1.2560.
Until that time, 1.2770 should be treated as new support for GBPUSD.
Lastly, I’m not interested in longing GBPUSD here, given the multiple highs that have accumulated between 1.2800 and 1.2900 since last December.
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