The resistance of GBP/USD pair has broken; it turned to support around the price of 1.1817 last week. Thereby, forming a strong support at 1.1817.
The direction of the GBP/USD pair into the close this week is likely to be determined by trader reaction to 1.1817 and 1.1979. The GBP/USD pair climbed above the level of 1.1817 before it started a downside correction.
The GBP/USD pair set above strong support at the level of 1.1817, which coincides with the 23.6% Fibonacci retracement level. This support has been rejected for three times confirming uptrend veracity. Hence, major support is seen at the level of 1.1817 because the trend is still showing strength above it.
The level of 1.1817 coincides with the golden ratio (23.6% of Fibonacci retracement) which is acting as major support today. Another thought; the Relative Strength Index (RSI) is considered overbought because it is above 70.
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 will probably show the signs of a bullish trend. This suggests the pair will probably go up in coming hours. Accordingly, the market is likely to show signs of a bullish trend
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In other words, buy orders are recommended above 1.1817 level with their first target at the level of 1.1879. From this point, the pair is likely to begin an ascending movement to the point of 1.1929 and further to the level of 1.1979.
The price of 1.1979 will act as a strong resistance and the double top has already set at the point of 1.2600.
On the other hand, if a break happens at the support of 1.1716, then this scenario may become invalidated.
