FX.co ★ GBP/USD Intraday Forecast for October 27, 2011.

Pivot Point: 1.5967.

Time Frame: Daily and H4.

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Overview:

The GBP/USD broke the resistance at 1.5837 and turned back to support last week. Therefore the pair has already formed a strong support at 1.5837 on H4 and daily chart, Aswell after breaking 38.2% and start signing for bullish market on this level, it should be noted that the price has been set above 38.2% of Fibonacci retracement levels and the price couldn't close below the support last week since 21st of October 2011. Futhermore, the RSI has still positive on the daily frame, so it calls for a new upleg. Then, according to previous events, the pair has still been trapped between 1.5837 and 1.6041. For that it is a good sign to buy above 1.5900 with a first target of 1.6075, and continue towards 1.6190 (61.8% of Fibonacci retracement levels on daily chart and it also should be noted that the resistance 3: 1.6194). Meanwhile, if the support (1.5837) breaks and closure below it on H4, it will also a good sign to sell at 1.5837 with a target of 1.5700.

Trading Recommendations:

According to previous events, the price has still been trapped between 38.2% of Fibonacci retracement and 50%.

Long Buying:

• Buy above 1.5900 with a first target of 1.6075, it might resume to 1.6184.
  

Short Selling:

• Outlook -1-: Swing trade at 1.6200 in order to sell with a traget of 1.6118.
• Outlook -2-: Below 1.5837 look for further downside with 1.5750 and 1.5700 targets.
  

Intraday Technical Levels:

R3: 1.6194
R2: 1.6118
R1: 1.6043
PP: 1.5967
S1: 1.5892
S2: 1.5816
S3: 1.5741

Observation (s):

Please check out the market volatility before investing, because the sight price may have already been reached and scenarios become invalidate.

Key level at 1.5900.

Warning (s):

Stop Loss should NEVER exceed your maximum exposure amounts.
Risk to reward ratios are important and should be calculated.

Example 1:

A risk reward ratio of 1:1.5 is recommended:
Risk: 30 pips must make a profit of 45 pips.
30 pips * 1:1.5 = 45 pips.

Example 2:

A risk reward ratio of 1:1.5 is recommended:
Risk: 45 pips must make a profit of 60 pips.
45 pips * 1:1.5 = 60 pips.