GBP/USD Responding to Pre-Fed Level; Monitoring for Specific Setup

DailyFX

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eliottWaves_gbp-usd_1_body_gbpusd.png, GBP/USD Responding to Pre-Fed Level; Monitoring for Specific Setup

Chart Prepared by Jamie Saettele, CMT using Marketscope 2.0

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-GBPUSD made an inside day at resistance last Thursday following the largest one day advance since 7/1/10. After such an extended move, an inside day serves as a turn warning.

-The line that extends off of the 2009 and 2010 lows serves as an impediment to gains. The next possible resistance would be the line that extends off of the 2011 and 2013 highs at about 1.6225 and the January 2nd close (high of the year…first trading day of the year) of 1.6252.

-Price traded below the pre-Fed level of 1.5969 intraday but finished the day above the level.

Trading Strategy: If price drops into 1.5885, then the strategy is to short a bounce.

LEVELS: 1.5775 1.5885 1.5969 | 1.6072 1.6100 1.6162

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