The weather looks great today and we started the morning with a profitable signal (AUD/USD) which hit our take profit target a while ago. It´s a great start to our day, but let´s look at some support and resistance levels so the morning glory can last for us.
GBP/USD
Support – This forex pair lost about 40 pips in the last hour or so, but the support level around 1.2160-70 still holds. Therefore, that´s the first line of defense on the downside. 1.2150 is a mild support level but 1.2130 and 1.21 (give or take 10 pips) are much stronger. If we dive below, then 1.20 and 1.19 will be the only levels on the way to 1.16.
Resistance – The 20 SMA on the H1 forex chart comes at 1.21, so the area around there is a resistance cluster. It has provided support in the last couple of days and it turned into resistance this morning.
Above there comes 1.2240, where the 100 SMA stands, which obviously stretches to 1.2250. 1.2285 and 1.23 come next but I doubt we´ll see those levels anytime soon. In fact, I´m almost 100% sure I will open a sell forex signal if we crawl up to 1.21.
Considering the market sentiment and looking at the technical indicators, I think that by the time we get there, everything will be oversold which would be a great opportunity to sell.
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