Technical analysis of GBP/USD for January 09, 2017

Overview:

• The GBP/USD pair continues to move downwards from the level of 1.2315, which represents the double top on the daily chart. Last week, the pair dropped from the level of 1.2315 to the bottom around 1.2175. Today, the first resistance level is seen at 1.2206 followed by 1.2315, while daily support is seen at the levels of 1.2118 and 1.2031. According to the previous events, the GBP/USD pair is still moving between the levels of 1.2206 and 1.2031 in coming hours. The first resistance stands at 1.2206, for that if the GBP/USD pair fails to break through the resistance level of 1.2206, the market will decline further to 1.2118. This would suggest a bearish market because the RSI indicator is still in a negative area and does not show any trend-reversal signs. The pair is expected to drop lower towards at least 1.2050 in order to test the second support (1.2031). On the contrary, if a breakout takes place at the resistance level of 1.2315(the double top), then this scenario may become invalidated resistance of 1.2315.

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Source: Instaforex.com