Technical levels and Trading Recommendations on GBP/USD for December 16, 2014
As illustrated on the chart, the GBP/USD pair made a consolidation stage above 1.5890 up to 1.6100 for almost 20 days before bearish breakout could take position early in November.
Daily fixation below 1.5870 led bearish pressure to the pair so that it gets to the price level of 1.5600 where a new consolidation zone is being made above.
Previous week, the GBP/USD pair established intraday Demand around 1.5580-1.5550 where many recent lows were before made back in November.
The Daily outlook favors the bullish settings initially towards 1.5800 then 1.6100 provided that bulls remain trading above 1.5720 (which was avoiding earlier today).
The market may catch resistance around 1.5750-1.5800 (the upper limit of the recent price-range) and it may give some time for further sideways trend.
On the long period, a triple-bottom reversal pattern may be positioned above 1.5580.
Another less possible setting: a bearish flag pattern that waits for bearish breakout below 1.5550 (comparable to what occurred back in October). This is now excluded as long as the daily candlestick closes above 1.5750.
The 4H chart exposes the current consolidation movement kept within the limits of the illustrated channel. Recent bullish breakout took position earlier today.
The price level of 1.5680-1.5710 is now acting as an intraday Demand zone. Bearish pullback towards this area remains a valid Buy entry with SL as daily closure below 1.5650.