GBP/USD looking to break downwards

GBP/USD is looking to break into a downward trend and is currently testing an important level around 1.5625 and once it manages to break that level, then it will next look to target 1.5540 level and further breaks below that level will also come into picture. Traders might look to sell GBP/USD on rise to some reasonable level initially for decent targets and once it manages to break into a longer trend then they might look to extend the profits and thus use of trailing stop might prove effective here. A good reasonable level to sell GBP/USD can be seen around 1.5795 level and break above that will basically means GBP/USD looking to resume long term upward trend.

Looking at the moving averages used in daily charts, it can be seen that GBP/USD is currently just below the short term and medium term moving average and is just above the long term moving average. This suggests that once GBP/USD manages to break below this long term moving average, then the long term trend will follow it and in case it bounces from that level, it will look to follow in that case as well. RSI is around 45 and seems to support move in both directions.

 

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