Colin Jessup
The GBP/USD Daily Moving Average was broken today, with price actually closing the day 19 pips above the DMA. The last time price closed above the DMA was on November 11, 2011 when the DMA was running much higher at around 1.5933, whereas it now sits at 1.5605 after mixed price action over the last 2 months. This could be the strength the Bulls will need to carry the Sterling back above 1.5700 which has been a troublesome zone in the past.
Also providing the Bullish tone strength, which is the AO indicator show crossing over the zero meridian to the positive side, indicating the Bulls are firmly in control. However, we also have a descending trend-line above at 1.5655 which could take some steam out of the Bullish run. The 1.5650 level will be resistance for sure, as will 1.5700 and 1.5850. If price falls, the Bears will possibly see support at 1.5570, 1.5500 and 1.5425 below that...with such strong indications coming from the Bulls camp, its hard not to remain Bullish on this pair, at least for now.
Happy Trading
