Watching Resistance on Cable

Good morning forex friends!  With GBP/USD popping higher on fresh news of the US budget/debt deal being signed, will it be an extended move or will previous resistance stop it in its tracks?

GBP/USD 1 hour chart

GBP/USD 1 hour chart

This is the chart I’ll be watching for today’s trading session, in particular, the 1.6050 area.  Yesterday, we saw that pair turn back Cable bulls, even after a very strong UK employment data report (-41.7K vs. -25K forecast).  So, the question for today is, how long will this US Dollar selloff reaction last, and will the upcoming UK retail sales data have any influence on today’s Cable price action?

For now, I have no directional bias on the pair, and will wait-and-see what the UK retail sales data brings and the market’s reaction to it.  Stay tuned for observations and possibly a day trade idea by following me on Twitter and Facebook!

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  • On a daily time frame, I was short on the first leg on the down swing but liquidated once it hit resistance. I figured that it’d come back up and retest the high, and that’s exactly what it’s doing. I might short it again if I get a signal.