Financial Advisor

GBPUSD: Rallies, Maintains Consolidation Tone

GBPUSD: The pair has halted its declines started from the 1.6472 level and is now seen strengthening.This suggests that on continued upside gains, it will target the 1.6472 level where a decisive break will open the door for further strength towards the 1.6546 level, its May 31'2011 high. A cut through here will open the door for more upside gains towards the 1.6743 level, its 2011 high. Its daily RSI has turned higher supporting this view. On the downside, support comes in at the 1.6222 level traded on Tuesday with a violation of that level eyeing the 1.6193 level where a cap is likely to occur. However, the bigger challenge will be a break and hold below the 1.5778 level, its July 12'2011 low. In such a case, the 1.5749 level, its Jan 25'2011 low will be targeted followed by the 1.5700 level, its psycho level. All in all, GBP still maintains its recovery tone set from 1.5778 level but must climb above the 1.6472 level to resume that recovery.

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