Forex Analysis: GBP/USD Pauses Near Triple Top Resistance

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GBP/USD Daily Chart

GBP/USD (daily chart) has tentatively paused its climb around a rough triple top resistance area in the 1.6300 price region. The first top of the triple top was established in April, then re-tested and respected in September, and finally re-tested and respected again yesterday with a minor shooting star candle retreat. Since yesterday, price has regained some of that retreat, with price once again rising to approach the 1.6300 level. This occurs within the context of a strong overall bullish trend extending back to the June 1.5266 low. It also occurs in the midst of a steep uptrend that has been in place for the past two weeks. If the pair is able to further this bullish trend with a significant breakout above 1.6300, which would confirm a bullish trend continuation, price could move towards further potential resistance around the 1.6475-1.6500 price region. If price once again respects the 1.6300 level with a retreat to the downside, key potential support on a bearish correction could reside around the important 1.6150 price region.

James Chen, CMT
Chief Technical Strategist
FX Solutions

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About Author

James Chen is Chief Technical Strategist for City Index Group. He is also a Chartered Market Technician. He is the author of the books: "Essentials of Foreign Exchange Trading" (John Wiley & Sons, 2009) and "Essentials of Technical Analysis for Financial Markets" (John Wiley & Sons, 2010). Mr. Chen writes currency analysis, leads forex trading seminars and has appeared in numerous major financial media outlets, including CNBC, Bloomberg TV, Forbes, Reuters, Dow Jones, and the Associated Press.