10 Mar 2014; GBPUSD
The pound hit the resistance last week at around 1.68. Friday high was 1.6786. It retreat back to 1.672.
Today, I am expecting Europe to continue to post good economic news from the French and Italian government. This will help to maintain EUR as well as the pound to sustain and attempt the resistance line again. The trigger that may affect is at 2215SGT when MPC member speaks about the UK economy.
On the political side, with the Ukraine-Russia conflict with the US getting their hands into the war, it may gave the USD a good bet as a safe haven, as usual for major political and finance happening. It will be a good excuse for those betting on the USD to rise and for those who wants to take profit for the EUR and GBP.
Looking at the technical for clues - resistance line continues to be at 1.68. If a case of breakout occur and is able to sustain a good bet is to buy the pound and take profit at a new high above 1.71- 1.72 region!
CCI(34) shows a great tapering - meaning a pending breakout. The range has been kept at 1.680 and 1.658. As the price is now hovering at 1.673, a good sell will be at 1.677-1.679 and a good buy will be at 1.662 (both at the daily fib support as well as the daily EMA55 line). The mid line to take profit is at 1.668 which happens to be the daily EMA21 line).
If a break out below 1.660, prepare to sell the pound and expect the support line at 1.650.
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