FX.co ★ GBP/USD Intraday Technical Analysis September 7, 2011

The GBP/USD is in a strong downside movement since it broke the bullish channel on August 30.

Yesterday We had a long bearish candlestick breaking the support level 1.6100 hiting our SL for the long position.

Thus we have a confirmed "Double TOP" on the daily chart with neck-line at 1.6100.

This double top has its target final target at 1.5740.

Now the downside movement seems to be temporarily limited by the support level 1.5900.

Based on the previous analysis and expectation, The best SELL areas are around 1.6100 ( broken neck-line ) and 1.6200-1.6250.

As we said above the final target for these short positions would be around 1.5740 with profit taking every 70 pips.

For the short term, long positions may be taken with small lot size to make use of the current retracement towards 1.6100 & SL break of 1.5900.