GBPUSD continues to hold above 1.4800 yesterday after reaching a low of 1.4738 yesterday, just above Fibonacci Retracement -10.0% at 1.4726. Yesterday’s release of a neutral U.K Manufacturing PMI sent prices down towards a low of 1.4738 before a retracement occurred and with the release of a weaker-than-expected ADP Non-Farm Employment Change data, the pair soon broke above 1.4800. With the formation of a doji on the daily chart yesterday, a reversal is expected to happen soon which may be driven by the release of U.K Construction PMI data later in the day.
Observing the H4 chart, candles now draw near the top of the downward sloping trend channel where a continuation of the downtrend may occur. However, the pair was observed to be supported again at 1.4754 from the previous drop in prices after candles touched the upper trend channel. With candles failing to develop a lower low, candles may be expected to reverse and go on a bullish run. Should candles break above the upper trend channel, prices may go on a bullish run towards the resistance at 1.4982 in a longer term.
Focusing on the hourly chart, a slowdown in candle movements was observed upon nearing the upper trend channel. However, candles do not show any signs of a retreat in prices, indicating a possible break out of the trend channel. If candles today do break above the trend channel, it is highly possible that the pair reverses and go on the bullish run.