GBP/USD’s break above the 200-day simple moving average (SMA) and 1.57 figure was short lived. The failure to sustain above the 200-day and spinning top candlestick that formed yesterday suggests the potential for a correction to the downside. Cable briefly dipped below the 1.56 figure today before finding support around the 23.6% Fibonacci retracement of the rally from May 28 lows to yesterday’s highs.

Some key levels to watch:

Support

• 1.5575 – 23.6% Fibonacci retracement and horizontal pivot
• 1.5470 – 38.2% Fibonacci retracement
• 1.5360/80 – 21- and 55-day SMA’s and 50% retracement

Resistance

• 1.5695 – 200-day SMA
• 1.5750 – recent high
• 1.5880 – prior highs