FX.co ★ Weekly technical levels of GBP/USD for July 29, 2014

Review:

• If the trend is upwards, then the strength of the currency will be defined as follows: GBP is in an uptrend and USD is in a downtrend. Fibonacci retracement is used to determine accurate psychological levels of support and resistance. The timeframe should be taken into account. Fibonacci is in a range trade; it looks like the trend is trapping and going up or down. If you sell or buy for a long term in this period, you will surely lose your profit. It should be noted that if there is no significant news to influence, the market price will be moving from the pivot point to resistance 1 or support 1. But if there is a significant news, the market price may go straight through resistance 1 or support 1 and reach resistance 2 or support 2 and even resistance 3 or support 3.

The weekly pivot point of GBP/USD pair.

Forecast:

• According to the previous events, the price of the GBP/USD pair has been moved between 1.7015 and 1.6930.
• The level of 1.9012 is representing the weekly pivot point. It should be noted that the weekly pivot point coincides with the ratio of 38.2% Fibonacci retracement levels.
• Consequently, sell below 1.7015 in the short term with the first target of 1.6961 in order to test the double bottom, it might resume to 1.625 (the support 1) if the trend is able to break the double top at 1.6961.
• The stop loss should never exceed your maximum exposure amounts. Thus, it will be quite profitable to set your stop loss at the level of 1.7043.