18.05.202214:10 Forex Analysis & Reviews: Trading plan for GBPUSD on May 18, 2022

Technical outlook:

GBPUSD raised through 1.2500 in the early Asian session on Thursday before reversing sharply. The currency pair slipped towards the 1.2370 mark intraday and is now seen to be trading at around 1.2420. Bulls are looking poised to remain in control from here on and push prices through 1.2640 in the near term.

GBPUSD faces immediate price resistance around 1.2640-50, followed by 1.3150 and higher; while interim support comes around 1.2155 respectively. Prices are expected to carve higher highs and higher lows until the 1.2155 interim low remains intact. Also, note that prices are breaking above the major resistance trend line close to the 1.2450-1.2500 zone.

GBPUSD has reversed after the strong bullish divergence we have been calling since the 1.2155 low. The currency pair has rallied over 350 pips from the low marked in the last week. Most traders are willing to hold long positions initiated last week with a potential near-term target of around 1.2650 at least. We can expect a meaningful pullback thereafter.

Trading plan:

Potential rally through 1.2650 against 1.2100

Good luck!