In the course of a correctional decline from the psychological level of 1.4000, went down to 1.3900 where the price got stuck in a range and then made an upward retracement.
The importance of the 1.3900 level has been confirmed a lot of times. On July 6, 9, 12, 13, 14, and 15, this level served as support and resistance.
Outlook and trading tips
Judging by the technical chart, the currency pair has been trapped between the two important levels: 1.3900 and 1.4000. This tight range subdues volatility. The quiet market enables the pair to gain momentum so that its dynamic will speed up again.
The trading tactic would be a breakout strategy. In essence, a trader should wait for a breakout of either support of 1.3900 or resistance of 1.4000. The market entry will depend on the direction of a breakout.
Let me sum up the above information in the following trading tips.
If the price breaks out resistance of 1.4000 and holds firmly above it, this will prove a further climb of GBP/USD. The door will be open towards 1.4100 – 1.4150.
Alternatively, a downward move will be confirmed in case the price breaks out support of 1.3900 and holds firmly below it. This will open the way downwards to 1.3800.
Complex indicator analysis is generating a buy signal in the short term or for intraday trading. We can enter the market with long positions during a bounce off 1.3900.
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