Trading plan for GBP/USD for December 31, 2020

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Technical outlook:

GBP/USD has managed to print fresh highs today around the 1.3649 mark before pulling back. The single currency is seen to be trading around the 1.3627 levels at this point of writing and might be preparing to continue lower towards the1.3400 levels in the short term.

Immediate price resistance is seen around the 1.3650/70 zone, while support comes in at 1.3430, followed by 1.3200 respectively. A drop below 1.3400 could be seen as confirmation of a meaningful top in place around 1.3649 today. The wave structure depicted on a daily chart here looks mature, and a break below 1.3200 from here might trigger further selloff.

Also note that prices would break below its March 2020 trend line support if bears are successful to take out the 1.3200 support. Furthermore, potential remains for a drop to materialize towards the 1.2200 zone, which is fibonacci 0.618 retracement of the entire rally between 1.1414 through the 1.3649 levels respectively.

Trading plan:

Remain short with stop above 1.3700, target is at 1.2200

Good luck!

The material has been provided by InstaForex Company - www.instaforex.com