The GBPUSD continued to maintain its bullish momentum the past few weeks, now pressure will be on the key resistance 1.5507 - high of the week 17 Feb 2013 , this level is a pivotal in the medium/long term outlook, to resume its upside offensive , a break and hold above 1.5507 on a weekly closing basis is needed,If seen, we would have 2 scenarios :
Scenario A : the pair will hold above 1.5507 before attacking 1.5775 ahead of 1.6000 levels, break of 1.6000 will target 1.6400 levels.
Scenario B : the pair is likely to pullback below 1.5507 levels before the next rise towards 1.5755/ 1.6000 levels, so the pair could retest the 1.5200/1.5000 levels, strong support should be seen here and rebound to the 1.5755/1.6000 levels is likely from this level , but in a strong bearish correction ,it might dip to the 1.4830 -double bottom - before flying towards 1.6000 levels.In all , If 1.5507 is taken out, the pair will remain baised to the upside even in case of bearish correction .
On the downside, a failure to hold above the 1.5507 levels on a weekly closing basis , could mean a return to the 1.4830 levels, a break below 1.4830 will have large bearish implication towards 1.4000 levels.
If we take a quick look to the monthly chart, fall from 1.6380 was rejected by price action around 1.4800 levels with hammer - bullish reversal candle - added to that %(R) indicator is diverging the price positively ,a monthly close above 1.5260 - March 2013 high - followed by a weekly close above 1.5507 is likely to have large bullish implication towards 1.6400/750 levels by the end of 2013 !!