The GBP/USD pair successfully achieved its projection target around 1.6600 after the bullish breakout above 1.6250. This price level is acting as a daily resistance for the pair until now.
Last bullish movement exceeded 1.6600 rendering 1.6666 as the highest price in January. However, bearish engulfing daily candlestick was immediately expressed off these high levels (1.6666).
Some sideway consolidation (two Doji daily candlesticks) was expressed around 1.6600 until obvious bearish pressure was applied on the currency pair, resulting in a bearish pattern Three Black Crows, which was confirmed with Monday's daily closure.
The next demand level is located at 1.6250 where a recent bottom was established on December 17. Yesterday's candlestick barely reached 1.6257 and the resulting candlestick was a bullish hammer indicating bullish presence around 1.6250.
Today, another attempt to test 1.6250 is taking place. Daily closure should be observed for price action.
As mentioned before, the GBP/USD pair's short-term direction turned to be bearish after the breakdown at 1.6450-1.6460.
Fixation below 1.6450 triggered bearish pressure towards 1.6400, then 1.6300, which was hit during late Monday's consolidations.
The 4H chart shows a demand zone located at 1.6250-1.6280 corresponding to the backside of the depicted bearish channel as well as previous congestion zone.
This price zone may initiate corrective bullish movement to the upside to collect more sellers around 1.6400-1.6450. However, early fixation below this zone will bring further bearish momentum without the retesting of 1.6450.
Selling the pair is suggested at the retesting of 1.6450 with Stop Loss as daily closure above 1.6475.
The material has been provided by InstaForex Company - www.instaforex.com
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