We are seeing some bullish signals from GBP/USD and will be looking for an opportunity to establish a long position.
It looks like at this point that the market has accepted David Cameron’s budget at face value and has pushed worries about the nation’s fiscal situation to the sidelines.
We have broken above the 100-day moving average, the key 61.8% retracement level and above resistance in the 1.50 zone. It is impossible to ignore such bullish price action. We are now in an uptending channel above the 14-day moving average (red).
We are seeing some signs of consolidation. Today’s price action has been quiet as we trade in a 55-pip range. We see scope for a slide to the 100-day moving average (blue) but would view this as a buying opportunity for an eventual rally toward 1.5524.