GBP/USD (daily chart as of August 13, 2013) touched a high of 1.5573 on August 8 and formed a small bullish candlestick with a relatively long upper shadow, showing the resistance at its session high, which was close to the multiple highs from May 1 to May 9 (pink rectangle shape on the chart). Price is now testing 1.5410/00, the 61.8% Fibo retracement level surpassed on August 7 (arrow 6 on the chart) with a very strong bullish candlestick. In addition, that bullish candlestick had a long lower shadow formed right at the uptrend line (bold blue trend line), and confirmed once again the significance of the line.
The above uptrend line was broken (which was considered a false break) on July 4 with high volatility events. The testing of that uptrend line has been choppy, based on the subsequent price behavior from July 11 to July 17 (arrow 4) and from July 31 to August 2 (arrow 5). More follow-through price action would be required to confirm any major movement for this high-beta (or high-risk) pair. Price needs to hold 1.5400 and break above 1.5570/5600 to test 1.5750. The daily MACD is making a bullish crossover above zero, and the daily RSI is about to test 50 from above.
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