GBPUSD Longs Favored Above 1.5540- Scalps Target May Highs

DailyFX.com -

Talking Points

• GBPUSD responds to key support- broader outlook remains constructive

• Rebound approaching near-term resistance into 1.57

• Event Risk on TapThisWeek

GBP/USD Daily

GBPUSD Longs Favored Above 1.5540- Scalps Target May Highs

Chart Created Using FXCM Marketscope 2.0

Technical Outlook

• GBPUSD holding within the confines of well-defined median-line formation- constructive

• Rebound off key support confluence keeps long bias in play

• Key support at 1.5497- bullish invalidation

• Interim resistance 1.5773 backed by key resistance into 1.5820/77

• Break below support targets 1.5190, 1.5040

• Momentum profile remains constructive- note pending support trigger

• Event Risk Ahead: U.S. Consumer Price Index (CPI) on Friday

GBP/USD 30min

GBPUSD Longs Favored Above 1.5540- Scalps Target May Highs

Notes:The pound has reacted to a key support confluence just below the 1.54-handle with the rebound taking out the ML extending off last week’s highs. The broader trade remains constructive above this feature with our near-term bullish invalidation eyed at the highlighted region around the 1.5542 with a break sub 1.5497 (close basis) putting the short-side back into play.

Bottom line: we’ll favor buying pullbacks / resistance triggers while above the ML with a breach above upper MLP / 1.57 targeting subsequent topside resistance objectives into the 1.5877 barrier. A quarter of the daily ATR yields profit targets of 37-40 pips per scalp. Caution is warranted heading into tomorrow’s event risk with U.S. Inflation data likely to fuel added volatility in USD based pairs.

* It’s extremely important to give added consideration regarding the timing of intra-day scalps with the opening ranges on a session & hourly basis offering further clarity on intra-day biases.

For updates on this scalp and more setups throughout the week subscribe to SB Trade Desk

Relevant Data Releases

GBPUSD Longs Favored Above 1.5540- Scalps Target May Highs

Other Setups in Play:

• EURCAD Pullback Stalls at Support- Sub 1.3538 to Negate Bullish Bias

• Scalp Webinar: USD At Risk For Bearish Invalidation- 11,737 In Focus

• NZDJPY Rebound Testing Resistance- Scalps Target 89.50 Inflection Zone

• EURJPY at Risk Sub 135- Short Scalps Favored

---Written by Michael Boutros, Currency Strategist with DailyFX

Follow Michaelon Twitter @MBForex,contact him at mboutros@dailyfx.com or Click Here to be added to his email distribution list

Join Michael for Live Scalping Webinars on Mondays on DailyFXat 12:30 GMT (8:30ET)

Interested in learning about Fibonacci? Watch this Video

original source

DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.
Learn forex trading with a free practice account and trading charts from FXCM.