GBPUSD Intraday Technical Analysis for September 12, 2012 - The spot rate made a pull back yesterday at the intermediate support of its medium term bullish channel at 1.5980 and approaches now the upper limit of this one at 1.6100 suggesting a decline. However, a break of these levels will release a good potential and initiate a more violent bullish channel.
Technical indicators provide buy signals but approach an overbuy zone supporting the assumption of a decline in a short-term. Bollinger bands are much discarded as a result of a strong increase these days. Stabilization is expected in a short-term. Moreover, the superior band strengthens the upper limit of its channel also strengthening the hypothesis of a decline.
As the spot rate is currently testing the upper limit of its channel, we suggest 2 scenarios: the first one is the hypothesis of a decline where we recommend a sell at the level of 1.6100 with the 1st objective at 1.6040 and then at 1.6020. A breakthrough of 1.6120 will invalidate this scenario. The second scenario is a break of its resistance where we recommend a “buy stop” which means buying the spot rate as soon as it is broken through its resistance at 1.6100 with the 1st objective at 1.6160 and then at 1.6180. A breakthrough of 1.6080 will invalidate this scenario.
GBPUSD Intraday Technical Analysis for September 12, 2012 - Source: InstaForex
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