FX.co ★ GBP/USD Intraday Technical Analysis for December 6, 2011.

Pivot Point: 1.5652.

Time Frame: H4.

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Overview:

The GBP/USD broke the resistance at 1.5525 and turned back to support last week. Therefore the pair has already formed a strong support at 1.5525 on H4 chart, Aswell after breaking 11% and start signing for bullish market on this level, it should be noted that the price has been set above 11% of Fibonacci retracement levels and the price couldn't close below the support last week since 29th of November 2011. Futhermore, the RSI has still positive on the daily frame, so it calls for a new upleg but only on daily chart. Then, according to previous events, the pair has still been trapped between 1.5794 and 1.5504. For that it is a good sign to buy above 1.5504 with a first target of 1.56, and continue towards 1.5706 (38.2% of Fibonacci retracement levels on H4 chart and it also should be noted that the resistance 3: 1.5848). Meanwhile, if the support (1.5525) breaks and closure below it on H4, it will also a good sign to sell at 1.55 with a target of 1.5375 for November 6th, 2011.

Trading Recommendations:

According to previous events, the price has still been trapped between 38.2% of Fibonacci retracement and 23.8%.

Long Buying:

• Buy above 1.55 with a first target of 1.56, it might resume to 1.571.
  

Short Selling:

• Outlook -1-: Swing trade at 1.58 in order to sell with a traget of 1.565.
• Outlook -2-: Below 1.55 look for further downside with 1.5422 and 1.5375 targets.
  

Intraday Technical Levels:

R3: 1.5848
R2: 1.5782
R1: 1.5718
PP: 1.5652
S1: 1.5588
S2: 1.5522
S3: 1.5458

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 1.576.

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.