Thursday, 10th of Nov, 2011
DAILY TECHNICAL STRATEGIST
GBPUSD: Wipes Out Three-Day Gains, Risk Remains To The Downside.
GBPUSD: Having turned lower ahead of 1.6161 level, its Oct 31’2011 high and sold off strongly to wipe out its three-day gains on Wednesday, risk of further downside weakness is expected. In such a case, the 1.5874/50 zone will come as the next downside support where a reversal of roles is likely to occur and turn the pair back up. However, if violated, further declines should build up towards to the 1.5632 level, its Oct 18’2011 low and possibly lower towards its Oct 12’2011 low at 1.5541. Its daily RSI is bearish and pointing lower supporting this view. Alternatively, the risk to this analysis will be a return to the 1.6161 level where a breach will resume its short term uptrend towards the 1.6204 level, its Sept 06’2011 and subsequently its Aug 30’2011 high at 1.6418. On the whole, the pair may have backed off higher prices but continues to hold on its short term uptrend.
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