By: Mike Kulej
Recently, there have been some questions about the uptrend in the GBP-USD. After rallying strongly from 1.4230 in May to 1.5995 August, this pair settled into a long trendless period. Its apparent inability to close above the 1.6000 resistance put the uptrend in doubt.
Not any more. After a couple of tries, the GBP-USD managed move, and more importantly, close above the 1.6000 level on the daily chart. This action confirms that the bullish run is still valid and likely will continue. There are other clues, which also support more upside. All new highs, and lows, are higher than the preceding ones, in line with the textbook definition of an uptrend. The price remains comfortably above the main trendline, also confirming the current market direction.
The ADX indicator, which is often used as a trend-qualifying tool, has turned up after showing a low reading for some time. This increase is consistent with strengthening trend, suggesting that the direction of the GBP-USD should remain up for the most immediate future, probably until the next resistance of 1.6450 is reached.