Above is GBPUSD pair which I follow, what I see here is a consolidation in this pair which has never taken place since a month on a scale. Could this be a possible break-out which before Christmas eve and New Year.
At this moment it is difficult to make an assumption but based on the recent rally in dollar it looks like if this breaks below 1.6200 it will make a big damage by whiping out all long traders who are possiblly under impression that this pair has gone under-valued.
Or could this be a signal before an uptrend which will confirm by tommorow's UK CPI reports, and also the important interest rate policy by fed. If reports shows a controlled CPI doing well below forecaste 1.8% this will give a support and a possible 1.6800 can take place.
Well I am supporting the later possiblity for an uptrend, becuase a good employment report last week which was supposed to increase the so called risk appetite among the investors did exactly reversed and supported dollar, making weak oil prices and a major Dubai World crisis might have forced investors to look for safe zone.
This week is crucial with a perspective of how dollar is going to react, a firm increase in USD may leave this year end to a positive note or to the same way that we have been noticing this year all along.
Time will tell....
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