- The GBP / USD rally ran out of steam near its ascending channel resistance two months ago.
- Any drop to 1.31 could be seen as a buying opportunity.
- Significant move beyond channel resistance could open the door for more gains.
The rally in GBP / USD faded to a two-month high which eased to the 1.3310-15 area. which marks the upper limit of an ascending channel from mid-September.
GBP / USD fell to daily lows at 1.3230. Any further declines could attract lower buying around 1.3200, limiting the decline around resistance at 1.3180-75.
However, any consecutive sells below 1.3150-40 could reverse the uptrend and prompt technical selling. The GBP / USD could then accelerate the sell to 1.3100.
1.3300 could cap the rise. A significant surge here could see more buyers come in and set the stage for a move towards daily resistance from the September closing highs at 1.3385.