GBPUSD continues to trade inside the up-trending equidistant channel for two consecutive months in June and July after bottoming out during May, this year.
GBPUSD in strong uptrend but resistance is near
Price has now surpassed the high created in April 2010, where the resistance created in April may now appears as a potential support zone in the near term.
On Friday, 30th July, GBPUSD hit the top of the equidistant channel as well as the resistance zone level. We can see a very clear support turns resistance zone highlighted in red as shown in the chart above.
For the bulls that have missed out the rally, would probably want to go long in two of the conditions below:
a) To go long IF price continues to get supported at the bottom of the uptrend equidistant channel
b) To go long IF price gets supported at the support zone, where resistance turns support level
For the bears, they would probably want to see some form of reversal pattern reacting at the resistance zone (i.e. double top, head and shoulder or triple top etc…) in the lower timeframe before the bears are convince to short it down.
It is important to note that currently, we don’t see any reversal pattern as price is still forming a higher high and higher low in the four-hourly chart; therefore, we will continue to assume the trend is up until we see some forms of reversal pattern as mentions above.
