GBP USD On Pace to Test 1.6085

GBP USD traders continued to position themselves ahead of next week’sU.S. Treasury auction as concerns over increased supply hitting themarket is leading traders to think that U.S. debt is getting out ofcontrol.

GBP USD traders continued to position themselves ahead of next week’s U.S. Treasury auction as concerns over increased supply hitting the market is leading traders to think that U.S. debt is getting out of control.

Traders are also building in a premium in anticipation of a possible debt reduction by either the S&P Corp. or Moody’s debt rating service.

The daily chart indicates the GBP USD is on pace to test a 50% resistance level at 1.6085. Regaining this price on a closing basis could lead to a further rally to 1.6694.

These are just upside objectives of where the market may run into resistance. Upside momentum is so strong that it would be foolish to stand in front of the trend. Aggressive counter-trend traders have to read the trade when this area is being tested for clues of the start of selling pressure.

The hourly chart is showing signs of slowing down. A primary top has been formed at 1.5943 and a secondary lower top may be forming at 1.5937. Based on the current set-up, the market may break following a trade through 1.5853.

James A. Hyerczyk has been actively involved in the futures markets since 1982. He has worked in various capacities within the futures industry from technical analyst to commodity trading advisor. Using W. D. Gann Theory as his core methodology, Mr. Hyerczyk incorporates combinations of pattern, price and time to develop his daily, weekly and monthly analysis. His firm, J.A.H. Research and Trading publishes The Forex Pattern Price Time Report... More

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