By: John Ursus
Timeframe: W1 Recommendation: Short Position
Entry Zone: 1.6630 – 1.6700
Take Profit Zone: 1.6400 – 1.6430
Stop Loss Zone: 1.6800 – 1.6830
The GBPUSD currency pair has rallied sharply as visible in this W1 chart. The sharp rally can be partially attributed to a much stronger than expected UK economy which has prompted rumors of a potential interest rate increase by the Bank of England as early as 2014. The other reason for this rally is a weaker than expected US economy which caused the GBPUSD to rally sharply.
This currency pair has now approached a very strong resistance zone from where forex traders may take some profits before the rally resumes. Forex traders should look for entry levels to their short trade inside the current resistance zone. Make sure you protect floating trading profits with stop loss orders as a breakout above the current resistance zone could open the way to 1.7000.