FX.co ★ GBP/USD Intraday Technical Analysis & Trade Recommendation December 8, 2011

Yesterday GBP/USD shooted up recording a high at 1.5723 inside the violet channel, Now it's testing the resistance area presented in the upper limit of the marked channels.

Now the upside movement seems to be losing its steam so retracement is expected. Level 1.5720 is a good level to SELL the GBP/USD to make use of the expected retracement.

It's also important to note that we have 1.5645-1.5624 is a very good intraday support area ( the intermediate support line of the Yellow channel & previous broken top ) which will be a good long-term LONG entry.

VIOLET CHANNEL represents Yesterday's movement.

BLUE CHANNEL represents the last 2 days' movement.

YELLOW CHANNEL represents the last 3 days' movement.

Based on the previous analysis:

The pair is in a medium term bullish direction & short-term bearish retracement is expected today before resuming the upside movement.

The suggested trades today are:

-GO SHORT at around 1.5720 [SL 1H closure above 1.5735 & TP at 1.5675 then 1.5650].

- GO LONG at the best prices around 1.5645-1.5624 [SL placed below 1.5590 & TP at 1.5670, 1.5695, 1.5745 then 1.5775 ].