The GBP/USD pair broke resistance which turned to strong support at the level of 1.1965 yesterday. The level of 1.1965 coincides with a golden ratio (50% of Fibonacci), which is expected to act as major support today. The Relative Strength Index (RSI) is considered overbought because it is above 55. The RSI is still signaling that the trend is upward as it is still strong above the moving average (100). This suggests the pair will probably go up in coming hours.
This support has been rejected for three times confirming uptrend veracity. Hence, major support is seen at the level of 1.1965 because the trend is still showing strength above it. Another thought; the Relative Strength Index (RSI) is considered overbought because it is above 60. At the same time, the RSI is still signaling an upward trend, as the trend is still showing strong above the moving average (100), this suggests the pair will probably go up in coming hours.
Accordingly, the market is likely to show signs of a bullish trend. In other words, buy orders are recommended above 1.1965 with the first target at the level of 1.1270. From this point, the pair is likely to begin an ascending movement to the point of 1.1270 and further to the level of 1.2100.
The level of 1.2152 will act as strong resistance and the double top is already set at the point of 1.2152. On the other hand, if a breakout happens at the support level of 1.1912, then this scenario may become invalidated.
Conclusion :
We should see the pair climbing towards the next target of 1.2070. The pair will move upwards continuing the development of the bullish trend to the level 1.2070 and 1.2152 in coming days. On the other hand, in case a reversal takes place and the GBP/USD pair breaks through the support level of 1.1912, a further decline to 1.1866 can occur. It would indicate a bearish market.
Forecast (GBP/USD) :
The volatility is very high for that the GBP/USD is still moving between 1.1965 and 1.2152 in coming hours. Consequently, the market is likely to show signs of a bullish trend again. Hence, it will be good to buy above the level of 1.2000 with the first target at 1.2070 and further to 1.2152 in order to test the daily resistance. However, if the GBP/USD is able to break out the daily support at 1.1912, the market will rise further to 1.1866 to approach support 2 next week.