GBP/USD – European session outlook

13 May 2016

Resistance – 1.4441, 1.4480, 1.4514

Support – 1.4413, 1.4387, 1.4354

Formation - Sideways action continues

• Pair clocked a low of 1.4423 in Asia before recovering slightly to trade around 1.4438 levels.
  

• Price action yesterday once again established around 1.44 as a strong support zone.
  

• Pair’s recovery from daily lows or a possible dip to 1.4413 (38.2% of 1.3835-1.4770) followed by a recovery above daily 5-SMA at 1.4435 could translate into a quick fire move to 1.4480 (daily 10-SMA). Further upside could run out of steam near 1.4530-1.4549.
  

• On the downside, only an hourly close below 1.4387 (rising trend line support on daily) would signal continuation of the fall from the recent cyclical high of 1.4770.