The Pound continues to strengthen on renewed optimism over the economic recovery as well as gaining support after the BOE announcement did not include an expansion of QE measures. In addition, the GBP/USD is rising further as concerns over the Dollar intensify. Skepticism in the quality of the USD World’s reserve status and concerns in the U.S. having to finance major budget deficits has kept the Dollar under pressure.
Looking at the 4hour chart, GBP/USD spiked above the 1.6700 handle to reach a fresh 1 month high at 1.6740. The bias is bullish in the near term with preferred startegy to buy on dips. Wall Street performance will be monitored and key in the pair’s next move.
Above 1.6700, GBP/USD is encountering strong levels of resistance at the 1.6740 followed by 1.6809 and 1.6908. Initial support can be found at 1.6666, followed by stronger levels at 1.6580 and 1.6500.
Trading levels in play:
Limit Buy @ 1.6558 Targets: T1 1.6595 – T2 1.6835 Risk 1.6498.
* After 20 pips profit move stop to entry, take profit at will. Comments will follow if outlook changes
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