The GBPUSD has been pounding against trend line resistance over the last two days. That trend line comes in at 1.6128 today. The high from yesterday came in at 1.6130 (right on the line). If the price moves and stays above this key level after Fed announcement the next upside targets would be the following:
- 1.6178 – topside trend line off the daily chart
- 1.61909 – Channel trend line off the hourly chart (see below)
- 1.6254 – High closing price for 2012
- 1.6299 – High price for 2012
- Remember the low to high trading range for the GBPUSD for the year is a small 1069. This is the most narrow trading range going back to at least 1980. Do not discount a potential squeeze above the April high.
Should the Fed decision lead to a move lower, I will be targetting the following downside targets:
- 1.6088 – Channel support on the hourly chart
- 1.6060-65 – Floor support from Tues/Weds trade. This is also high from April 2, low from May 9 and May 11th (see daily chart). Market broke down on the move below this area in mid-May
- 1.60486 – 100 hour MA (blue line in the chart below)
- 1.6032 – high from September 7th
- 1.5985 – 38.2% of move up from end of August low
- 1.5972 – 200 hour MA
Most traders are likely skeptical about the upside, but the market remains supportive. There are some nice technical levels off both the daily and the hourly charts that should guide the moves. Follow the clues.
