Overview:
GBP/USD: According to the previous events, the price has been trapped between 1.6050 and 1.6090; hence, it is of the wisdom to be careful in this area. Therefore, the first step is to wait for a period of a tight sideways range market before breakouts. Then, it is probable that the market is going to start showing the bullish signs. In other words, it will be a good sign to buy above 1.5980 with the first target of 1.6060 and it will climb towards 1.6110. However, if the pair fails to break 1.6120, the market will indicate a bearish opportunity below 1.6120, then the level will act really as strong resistance; that it will be a good sign to sell below 1.6120 with the first target of 1.6055 and it will call for downtrend in order to continue bearish move towards 1.5979 (23.6% Fibonacci retracement levels), the level of 1.5944 will form a double bottom.
Forecast:
Buy above 1.5980 with the first target of 1.6060, it might resume to 1.6120. Stop loss should be set below 1.5935. Below 1.6120 (1.6145: 78.6% of Fibonacci retracement levels) look for further downside with targets at 1.6014 in order to test the weekly pivot point and 1.5950. Stop loss should be set above 1.6153.
Observations:
Use historic prices to determine future prices. Fibonacci retracement should be used to determine an accurate psychology level of support and resistance, and playing according to it in this kind of period. Fibonacci in a range trader (it is looks like the trend is trapping and going up or down, if you sell or buy for a long term in this period you will go sure for losing your profit. Stop loss should never exceed your maximum exposure amounts. Usually the market has a high volatile, if the last day had a huge volatility.