GBP/USD (daily chart) has continued to maintain its bullish stance by making a significant advance after having had daily closes above the important 1.6000 level for the entire past week. This substantial move to the upside occurs after price broke out above several resistance levels, including the 1.6000 level, the 50-day moving average, and an important downtrend resistance line extending back to the September 1.6300 area high. This all occurs within the context of a well-established uptrend extending back to the June 1.5265 area low. With potential nearby resistance residing around the key 1.6150 level, any further upside momentum that breaks out above that level could move towards yet another re-test of the 1.6300 resistance region, first established in April and re-tested for the first time in September. To the downside, the key 1.6000 level continues to serve as potential support within the context of the longer-term bullish trend.
James Chen, CMT
Chief Technical Strategist
FX Solutions
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